Control of public spending and revenues is increasingly being left to states and localities. In order to understand the consequences of such a movement on the distribution of social spending, it is necessary to understand how fiscal distress will affect state and local budgets. This paper...

Several recent studies suggest that equalizing transfers in a federal system may distort the tax policy decisions of states. We study this issue for the German federal fiscal system. In a simple theoretical model, we first identify a substitution and an income effect of equalizing transfers. Our...

This paper aims to examine whether the status of fiscal decentralization generates efficiency in local spending behavior and leads to local fiscal performance and local economic growth, revealing not only the status of Romania from the point of vertical fiscal imbalance but also the fiscal...

This paper offers a comprehensive and updated review of the effects of intergovernmental grants. We focus on the main findings in the existing literature on the effects of intergovernmental grants on tax policy and choices, expenditure decisions, fiscal stability and behavioral choices, and...

The size of regional fiscal multipliers determines the efficacy of fiscal stimulus, the costs of fiscal austerity and whether countercyclical fiscal policy is more effective at the federal or local level. This paper studies fiscal multipliers in regions of a monetary union - US states, Eurozone...