Template-Type: ReDIF-Paper 1.0
Author-Name: Sandro Brusco
Author-X-Name-First: Sandro
Author-X-Name-Last: Brusco
Author-Email: sbrusco@notes.cc.sunysb.edu
Author-Workplace-Name: Stony Brook University
Author-Name: Luca Colombo
Author-X-Name-First: Luca
Author-X-Name-Last: Colombo
Author-Email: lucava.colombo@unicatt.it
Author-Workplace-Name: DISCE, Università Cattolica
Author-Name: Umberto Galmarini
Author-X-Name-First: Umberto
Author-X-Name-Last: Galmarini
Author-Email: umberto.galmarini@uninsubria.it
Author-Workplace-Name: Università dell'Insubria
Title: Local Governments Tax Autonomy, Lobbying, and Welfare
Abstract: What degree of tax autonomy should be granted to a regional government on
a local tax base? Although the regional policy maker aims at maximizing social
welfare, her tax policy may be distorted by the lobbying activity of local taxpayers.
In this political environment we characterize the conditions under which social
welfare can be increased by restricting the set of tax instruments available to the
local policy maker, i.e. the degree of local tax autonomy. We show that full tax
autonomy is likely to be dominated by minimal tax autonomy when there are many
groups of similar size, while the converse occurs when tax bases are asymmetrically distributed.
Length: 30
Creation-Date: 2010-07
File-URL: http://www.unicatt.it/Istituti/EconomiaFinanza/Quaderni/ief0097.pdf
File-Format: Application/pdf
File-Function: First version, 2010
Number: ief0097
Classification-JEL: D70, H71, H77
Keywords: Tax autonomy, lobbying, local public good provision.
Handle: RePEc:ctc:serie3:ief0097