Social and Behavioral Sciences Commons^™

Subnational Taxes In Developing Countries: The Way Forward, Roy W. Bahl, Richard M. Bird

ECON Publications

Both theory and experience in a variety of circumstances around the world suggest strongly that if fiscal decentralization is to produce sustainable net benefits in developing countries, subnational governments require much more real taxing power than they now have. Students of public finance have studied the subject, and practitioners in developing countries have installed many different versions of subnational government tax. In most developing countries there are potentially sound and productive taxes that subnational governments could use: personal income tax surcharges, property taxes, taxes on the use of motor vehicles, payroll taxes, and even subnational value-added taxes and local ‘‘business …

The Property Tax In Developing Countries: Current Practice And Prospects, Roy W. Bahl, Jorge Martinez Vazquez

ECON Publications

Over the past two decades there has been an unprecedented move toward decentralized governance all over the world. The changes have taken on special significance in many developing and transitional countries where centralized systems were perceived to have failed to deliver improved general welfare. The promise of political, administrative, and fiscal decentralization is that it can strengthen democratic representative institutions, increase the overall efficiency of the public sector, and lead to improved social and economic welfare for countries that decide to adopt it. One critical assumption behind those expectations is that decentralized governments will generally be more accountable and responsive …

Revenue Assignments In The Practice Of Fiscal Decentralization, Jorge Martinez-Vazquez

ECON Publications

No abstract provided.

Revealed Altruism, James C. Cox, Daniel Friedman, Vjollca Sadiraj

ECON Publications

This paper develops a nonparametric theory of preferences over one's own and others' monetary payoffs. We introduce “more altruistic than” (MAT), a partial ordering over such preferences, and interpret it with known parametric models. We also introduce and illustrate “more generous than” (MGT), a partial ordering over opportunity sets. Several recent studies focus on two-player extensive form games of complete information in which the first mover (FM) chooses a more or less generous opportunity set for the second mover (SM). Here reciprocity can be formalized as the assertion that an MGT choice by the FM will elicit MAT preferences in …

Tax Effort In Developing Countries And High Income Countries: The Impact Of Corruption, Voice And Accountability, Richard M. Bird, Jorge Martinez-Vazquez

ECON Publications

In this paper we argue that a more legitimate and responsive state is an essential factor for a more adequate level of tax effort in developing countries and high income countries. While at first glance giving such advice to poor countries seeking to increase their tax ratios may not seem more helpful than telling them to find oil, it is presumably more feasible for people to improve their governing institutions than to rearrange nature’s bounty. Improving corruption, voice and accountability may not take longer nor be necessarily more difficult than changing the opportunities for tax handles and economic structure. The …

La Programación Presupuestaria Plurianual Con Referencia A Su Práctica En El Reino Unido Y Dinamarca, Juan Luis Gomez, Jorge Martinez-Vazquez

ECON Publications

Las últimas décadas han sido testigos de una serie de innovaciones importantes en las políticas de presupuesto y control del gasto público. En todos los casos, estas innovaciones han perseguido los objetivos de crear una política fiscal más sostenible en un sentido macroeconómico, incrementar la eficiencia en la asignación de los recursos en las distintas áreas del sector público y mejorar la calidad de la gestión de los servicios públicos. El presente trabajo se centra en el estudio de los resultados obtenidos con la puesta en práctica de la presupuestación plurianual, y en su uso efectivo en dos países del …

Local Government Fiscal Competition In Developing Countries: The Case Of Indonesia, Francisco Javier Arze Del Granado, Jorge Martinez-Vazquez, Rentanida Renata Simatupang

ECON Publications

This paper explores the role and significance of spatial fiscal competition among local governments in the developing world. Although there is now a large literature on local fiscal competition in North America and Western Europe, little is known about the extent and significance of fiscal interaction among local governments in the many developing countries that have undergone fiscal decentralization process over the last decade. This paper, in particular, examines whether jurisdictional competition (in the forms of expenditure externalities, tax competition, and yardstick competition) has been present in Indonesia, a country that was strongly decentralized starting in 2001. Our empirical results …

The Property Tax In Practice, Roy W. Bahl, Jorge Martinez-Vazquez, Joan Youngman

ECON Publications

No abstract provided.

The Determinants Of Revenue Performance, Roy W. Bahl, Jorge Martinez-Vazquez

ECON Publications

No abstract provided.

Tax Policy In Developing Countries: Looking Back—And Forward, Roy W. Bahl, Richard M. Bird

ECON Publications

We review the changing nature of tax policy in developing countries over the last 30 years and consider what factors determining the level and structure of tax revenues in such countries may have changed recently and how such changes may affect future developments.

Pillars Of Fiscal Decentralization, Roy W. Bahl

ECON Publications

Fiscal decentralization can de be defined as the process of transferring budgetary authority from central government to elected subnational governments in order to grant them power to make decisions regarding taxes and expenses. This paper discusses, theoretically and empirically, what some consider the three pillars of fiscal decentralization: expenditure assignment, revenue assignment, and intergovernmental transfers. In the real world, almost all countries have these three pillars. However, there are no two countries alike because of the different possibilities at hand in designing a decentralized fiscal framework. Here, the international experience is studied to shed some light on the various institutional …

Pakistan: Provincial Government Taxation, Roy W. Bahl, Sally Wallace, Musharraf Cyan

ECON Publications

Pakistan’s intergovernmental fiscal system is out of balance. Provincial governments account for 35 percent of all government expenditures but only 7 percent of all taxes. It is doubtful that local residents see much connect between the level of taxes they pay to provinces and the expenditure benefits they receive. This means that the government misses out on one of the most important advantages of fiscal decentralization – taxpayers holding their elected provincial officials accountable for the quality of services delivered.

A second dimension of fiscal imbalance is the mismatch between the weak tax administration skills of the provincial governments and …

Opportunities And Risks Of Fiscal Decentralization: A Developing Country Perspective, Roy W. Bahl

ECON Publications

Since the 1980s, the rhetoric of fiscal decentralization has taken root in developing countries. Most developing countries now place the strengthening of subnational government on the development policy agenda. Despite all the pronouncements, plans, and even political promises, however, there has been no rush to grant state and local governments significant taxing powers and increased expenditure autonomy. Perhaps economic conditions have not been right for countries to adopt all-encompassing decentralization schemes, perhaps political freedoms were too new in some cases, or perhaps the idea still takes some getting used to. Whatever the reason, signs that countries are now ready to …