In this article, a data set corresponding to Spanish municipalities is used to test asymmetries in the effects of increases and decreases in grants on total spending, with political and financial factors included as possible explanations of them. Estimation results strongly support the...

This article focuses on the impact of both incrementalism and exogenous factors in budgeting. The authors present a double-distinction-based proposal combining incrementalism and exogenous factors and then apply this model to the case of Spain. This approach enables the authors to avoid some of...

A frequent finding in the local public finance literature is that renters are more likely to support expansions in the local budget than are homeowners. The renters' illusion hypothesis (renters are less aware of tax increases than are homeowners) has been commonly used to explain this behavior...

This paper investigates the relationship between public sector employment and fiscal decentralization. We develop a theoretical framework modeling the interactions between the central and subnational executives regarding the level of public employment at the central and subnational government...

Taxpayers unlawfully trying to avoid income tax in most countries can mis-report a wide variety of line items, including income sources, exemptions, deductions, and credits. Such portfolio opportunities, or “modes,†for evasion raise important policy questions. For example, increasing...

The authors build on the work of Engelmann and Strobel and of Ackert, Martinez-Vazquez, and Rider to examine the potential role of social preferences in tax policy design. They randomly assign each participant in a session to a group with five members. The payoffs to participants are determined...

There is a common belief that tax withholding systems have worked not only as Abstract efficient tax collection mechanisms but also as effective tax evasion controls. However, little is known about the role of withholding in tax compliance beyond the fact that withholding may reduce...

Updated estimates of various measures of central city-suburban fiscal disparities are presented for 1987, along with previously published ACIR estimates for selected years. The estimates show that central city-suburban fiscal disparities have not changed dramatically over the past 30 years....