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"reverse" Intergovernmental Transfers Between Regions With Local Public Goods

Author

Listed:
  • John Hartwick

Abstract

We report on the nature of a utility optimizing transfer fromone regional government to another when local public goods are present. Computer examples reveal that small differences in regional endowments result in large differences in equilibrium outcomes for two regions, under optimal transfers. The scale effect (lower tax charge per person for the same public good in more populous regions) leads to the small region generally providing transfers to the larger region.

Suggested Citation

  • John Hartwick, 2009. ""reverse" Intergovernmental Transfers Between Regions With Local Public Goods," Working Paper 1221, Economics Department, Queen's University.
    • Handle: RePEc:qed:wpaper:1221
    as

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    File URL: https://www.econ.queensu.ca/sites/econ.queensu.ca/files/wpaper/qed_wp_1221.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    intergovernmental transfers; local public goods; inter-regional resource allocation;
    All these keywords.

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • R28 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Government Policy

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