Predictive models of government spending behavior based solely on the median voter theory have demonstrated limited utility, particularly when intergovernmental grants are involved. Since the 1970s, research on the impact of intergovernmental grants and aids on recipient governments has...

The impact of state tax and expenditure limitations (TELs) on bond credit ratings is estimated using an incomplete (or unbalanced) panel from the US states from 1973 to 2005. Three indices of the restrictiveness of TELs are used. Both Moody’s and Standard and Poor’s bond credit...