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| Tekijä: | Strumpf, K. S. |
| Otsikko: | A predictive index for the flypaper effect |
| Lehti: | Journal of Public Economics
1998 : SEP, VOL. 69:3, p. 389-412 |
| Asiasana: | Decentralisation Public expenditure Fiscal policy USA |
| Vapaa asiasana: | Fiscal illusion |
| Kieli: | eng |
| Tiivistelmä: | It is well-established that lump-sum public grants boost local government spending more than an equivalent increase in private income, the flypaper effect. The paper is one attempt to allow for a heterogeneous response. The working conjecture is that government expenditure on administrative overhead is a gauge of voter control over fiscal decisions. High overhead spending implies a lower provision of public services and a stronger role for revenue-maximizing forces in the budget-setting process. As such, the flypaper effect should be more marked in high overhead communities. An overhead index is applied to a sample of Pennsylvania communities in the Philadelphia metropolitan area. It is difficult to understand these governments' spending propensities from various windfall revenues without the help of the overhead index, the supportive evidence for this approach. |
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