Fiscal federalism network

Fiscal Federalism Network Working Papers


Cover page‌‌‌ Sub-central Tax Autonomy

Working Paper N°20


Authors: Hansjörg Blöchliger and Maurice Nettley


This paper provides an update of the indicators that measure the tax autonomy of sub-central governments in OECD countries. Over the last decade, tax autonomy at the state level increased, while it hardly changed at the local level. The OECD now has tax autonomy indicators for the years 1995, 2002, 2005, 2008 and 2011.


Cover page‌‌‌ Valuation and Assessment of Immovable Property

Working Paper N°19


Author: Richard Almy


This paper addresses the following questions about immovable property taxation in OECD and partner countries: What is valued? How is it valued? And who values? It draws on published information and data on property tax policy and administration in 172 countries. It focuses on value-based taxes and the features of mass valuation systems.


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The Political Economy of Property Tax Reform

Working Paper N°18


Authors: Enid Slack and Richard M Bird


Property taxes are generally considered by economists to be good taxes, and many countries are being advised to increase and improve their property taxes. In practice, however, property tax reforms have often proved to be difficult to carry out successfully. This paper discusses why property taxes are particularly challenging to reform and suggests several ways in which efforts to reform this tax may become more successful in the future.


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Greening the Property Tax

Working Paper N°17


Author: Nicola Brandt


This paper reviews the literature and policy discussions about the role of the property tax for land use. Various externalities of the development of land, such as new infrastructure needs, the loss of open space or air pollution due to longer commutes as people locate far from city centres, are not internalised fully by property taxes or other policy instruments and this is often thought to contribute to excessive land use and urban sprawl. 


Fiscal Federalism Working Paper No16


Decentralisation and Economic Growth - Part 3: Decentralisation, Infrastructure Investment and Educational Performance

Working Paper N°16


Author: Kaja Fredriksen


Theories of fiscal competition between jurisdictions suggest that investment in productive relative to consumptive spending is higher in a decentralised setting, and that efficiency of the public sector is also higher. This paper empirically analyses the link between decentralisation and the composition of public spending as well as the relation between decentralisation and educational performance. The results suggest...


Fiscal Federalism Working Paper No15


Decentralisation and Economic Growth - Part 2: The Impact on Economic Activity, Productivity and Investment

Working Paper N°15


Authors: Hansjörg Blöchliger and Balázs Égert


This paper analyses the relationship between fiscal decentralisation and economic activity. Like other institutional arrangements, fiscal decentralisation affects firms, households and public entities, and the way they save, invest, spend or innovate. This in turn may have considerable consequences for the long-term growth potential of a country. Based on a set of growth regressions, the results suggest...


Fiscal Federalism Working Paper No14


Decentralisation and Economic Growth - Part 1: How Fiscal Federalism Affects Long-Term Development

Working Paper N°14


Author: Hansjörg Blöchliger


Intergovernmental fiscal frameworks usually reflect fundamental societal choices and history and are not foremost geared towards achieving economic policy objectives. Yet, like most institutional arrangements, fiscal relations affect the behaviour of firms, households and governments and thereby economic activity. This paper presents empirical research on the potential effects of fiscal decentralisation on a set of outcomes such as GDP, productivity, public investment and school performance.The results can be summarised as follows...



Tax competition between sub-central governments

Working Paper N°13


Authors: Hansjörg Blöchliger and José Pinero-Campos


Tax competition is the strategic interaction of tax policy between sub-central governments with the objective to attract and retain mobile tax bases. This paper evaluates the main issues regarding tax compettition.



Fiscal policy across levels of government in times of crisis

Working Paper N°12


Authors: Hansjörg Blöchliger, Monica Brezzi, Claire Charbit, Mauro Migotto, José Pinero-Campos and Camila Vammalle


The world is recovering from the worst crisis since the Great Depression, leaving a strong and lasting impact on Member countries’ public finances. This paper analyses how sub-central governments (SCG) ...



Explaining the Sub-National Tax-Grants Balance in OECD Countries

Working Paper N°11


Author: Claire Charbit


Normative principles provide a relatively clear set of rules for the balance between grants and taxes in the composition of SCGs’ revenues, but in practice, a variety of types of tax-grant systems are observed in OECD countries, which do not all follow these rules.



Finding the Dividing Line between Tax Sharing and Grants: A Statistical Investigation

Working Paper N°10


Authors: Hansjörg Blöchliger and Oliver Petzold


Tax sharing and intergovernmental grants are two sub-central funding arrangements that are often difficult to disentangle. The dividing line is not drawn uniformly across OECD countries or across time, ...



The Fiscal Autonomy of Sub-Central Governments: An Update

Working Paper N°9


Authors: Hansjörg Blöchliger and Josette Rabesona


This paper describes the progress that has been made since 2006 in establishing statistical databases on tax autonomy and intergovernmental grants, aiming to better understand sub-central finance and intergovernmental ...



The Spending Power of Sub-Central Governments: A Pilot Study

Working Paper N°8


Authors: Steffen Bach, Hansjörg Blöchliger and Dominik Wallau


This pilot study presents indicators that assess sub-central government (SCG) spending power by policy area. Traditional indicators – such as the share of SCG in total government spending – are often misleading ...



Taxes and Grants: On the Revenue Mix of Sub-Central Governments

Working Paper N°7


Authors: Hansjörg Blöchliger and Oliver Petzold


This paper analyses trends and driving forces in the revenue composition of sub-central government (SCG). Between 1995 and 2005 the share of SCG in total government spending increased significantly from ...



Market Mechanisms in Sub-Central Public Service Provision

Working Paper N°6


Author: Hansjörg Blöchliger


This paper compares and analyses the use of market mechanisms in core sub central policy areas, namely education, health care, transport, social protection, and environment. Arrangements like tendering, ...




Promoting Performance: Using Indicators to Enhance the Effectiveness of Sub Central Spending

Working Paper N°5


Author: Lee Mizell


This report examines the use of indicator systems for measuring and monitoring the delivery of sub-central public services. Specifically, the report aims to assess if and how central governments use such ...



Fiscal Equalisation in OECD Countries

Working Paper N°4


Authors: Hansjörg Blöchliger, Olaf Merk, Claire Charbit and Lee Mizell.


Fiscal equalisation is a transfer of resources across jurisdictions to offset disparities in revenue raising capacity or public service cost. It covers 2.5 percent of GDP or 5 percent of total government ...



Intergovernmental transfers and decentralised public spending

Working Paper N°3


Authors: Daniel Bergvall, Claire Charbit, Dirk-Jan Kraan and Olaf Merk.


A study of grant design that integrates both theoretical and empirical insights from the fiscal federalism literature, and information obtained directly from practitioners concerning their experiences with the implementation of different types of grants.



Fiscal autonomy of sub-central governments

Working Paper N°2


Authors: Hansjörg Blöchliger and David King.


This paper provides data and interpretation on the fiscal resources of sub-central government in OECD countries. It presents a set of fiscal autonomy indicators such as revenue and expenditure decentralisation, tax autonomy, intergovernmental grants and the stringency of fiscal rules.



Fiscal rules for sub-central governments: design and impact

Working Paper N°1<?em>


Authors: Douglas Sutherland, Robert Price and Isabelle Joumard.


How fiscal rules can help minimise pressure on resources and ensure that they are used efficiently.