Crime,Confiscation, and Frowth: For and Against Leviathan

This paper presents a dynamic general equilibrium model ofrent seeking in which the payoffs and the choices between productiveand non-productive activity are endogenous. The economy has the potential for endogenous growth, but when agents can choose between confiscation and productive investment, growth is no longer possible. The confiscation activity has multiple interpretations.In one, confiscation occurs as a result of theft;the lack of sufficient property rights eventually makesinvestment in productive activity unpalatable.Alternatively, confiscation is the result ofgovernment activity (e.g., taxation). The paper underlines the difficulty of creating aninstitutional structure conducive to growth.     

Property tax in Indonesia: measuring and explaining administrative (under‐) performance

One of the arguments made by some Indonesian government officials in defence of continued central control over the property tax is that it has performed well under their authority and that its decentralisation would inevitably result in weaker operations and outcomes. The property tax has indeed grown remarkably well over the past 15 years. This growth, however, has been from a very low base, has been dominated by increased revenues from the mining sector and has been driven by a small number of sub‐national governments. Recently, only around 40% of local sector property tax potential has been realised under central control, given the existing tax rate and base. Property valuations are the most problematic aspect of administration but tax coverage and collections are also sub‐standard. While there may, in fact, be insufficient local government capacity to manage the property tax, even to current levels of performance, this problem could be solved by transferring the relevant central staff to local governments, as has been carried out in other newly decentralised sectors. But even before tax administration is devolved, local governments could at least be given some authority over the property tax rate, presently one of the lowest in the world. Copyright © 2003 John Wiley & Sons, Ltd.     

Tax rates, tax administration and income tax evasion in Switzerland

This paper contains an empirical analysis of income tax noncompliance in Switzerland, based on the standard model of tax evasion. Noncompliance is found to be positively related to the marginal tax burden and negatively to the probability of audit, though the latter impact is only weak. There is no evidence of a significant deterrent effect of the penalty tax. The extended model reveals that noncompliance is positively related to inflation. Finally, noncompliance is significantly lower when citizens/taxpayers have direct control over government budgets, whereas the opposite holds when there is no such control.     

Cultural pluralism,nationalism and federalism: A revision of democratic citizenship in plurinational states

Abstract. This article poses three questions related to the current revision of democratic citizenship in plurinational states. The first question focusses on the analytical limits of the term 'multicultural' and on the question of where nationalist movements stand within cultural pluralism. The second question asks whether it is possible to overcome the inherent difficulties in the traditional concept of liberal–democratic citizenship in plurinational states. Finally, the third question asks whether federalism is an adequate framework to regulate a revised concept of democratic citizenship in plurinational states. These three questions are developed in three sections. In the first I put forward a typology that allows us to identify four kinds of cultural pluralism movements that are present within the current liberal democracies. In the second section I identify some of the shortcomings of the traditional concept of citizenship with respect to the plurinational integration of some democracies, making special reference to the standard liberal version by Rawls. I defend the right of the minority liberal nationalisms to be included in a revision of the concept of democratic citizenship for the next century. Finally, I discuss the role of federalism, paying special attention to the case of Catalonia and Spain within Europe, and to possible 'asymmetrical' reforms to the concept of democratic citizenship.     

On distinguishing between Leviathan and Public Interest governments in a federal state

The purpose of this paper is to derive testable implications for the proposition that provincial governments in a specific federal system are Leviathans, that is, revenue maximizers. The Leviathan model, associated with Brennan and Buchanan (1980) hypothesizes that governments behave like monopolies who seek to maximize their revenue. This model is contrasted with an alternative hypothesis, the Public Interest Theory. A theoretical model of a federal state, based on the Canadian system, is constructed and testable implications are derived. The principal feature of the model is that it is set in the context of a particular game involving the federal government, provincial governments and a consumer. In attempting to model this situation, care has been taken to try to incorporate as many institutional features of the Canadian federal system as possible, while still allowing the model to be somewhat parsimonious. With some modification, the model may be applicable to other countries with similar federal systems.     

The checks and balances of party federalism: German federal government in a divided legislature

In this study, we assess the potential for policy change of the German government of Helmut Kohl after unification combining party positions with formal bicameral settings in a spatial model of legislative action. We distinguish between two policy areas and two types of legislation, mandatory and non–mandatory legislation imposing either a symmetric or asymmetric power distribution between both German chambers. In order to identify German legislators' party positions in different policy areas, we use data from ECPR Party Manifesto research covering the period from German unification in 1990 to the end of the government of Helmut Kohl in 1998. We find that the federal government of Helmut Kohl had a policy leadership position until April 1991 with no procedural differences, but the gridlock danger for governmental proposals was higher on the societal than the economic dimension. Afterwards, the government's potential for policy change was considerably determined by the type of legislation, independently from the policy dimension. At the end of the Kohl era, the governmental policy leadership position was limited to policies that left even the opposition majority of German states better off. The procedural settings mattered greatly on the economic dimension, and the danger of gridlock on societal policy was smaller only for non–mandatory legislation.     

The checks and balances of party federalism: German federal government in a divided legislature

Abstract In this study, we assess the potential for policy change of the German government of Helmut Kohl after unification combining party positions with formal bicameral settings in a spatial model of legislative action. We distinguish between two policy areas and two types of legislation, mandatory and non–mandatory legislation imposing either a symmetric or asymmetric power distribution between both German chambers. In order to identify German legislators' party positions in different policy areas, we use data from ECPR Party Manifesto research covering the period from German unification in 1990 to the end of the government of Helmut Kohl in 1998. We find that the federal government of Helmut Kohl had a policy leadership position until April 1991 with no procedural differences, but the gridlock danger for governmental proposals was higher on the societal than the economic dimension. Afterwards, the government's potential for policy change was considerably determined by the type of legislation, independently from the policy dimension. At the end of the Kohl era, the governmental policy leadership position was limited to policies that left even the opposition majority of German states better off. The procedural settings mattered greatly on the economic dimension, and the danger of gridlock on societal policy was smaller only for non–mandatory legislation.     

Remaking the Chinese Leviathan: Market Transition and the Politics of Governance in China

Book reviewed: Dali Yang. Remaking the Chinese Leviathan: Market Transition and the Politics of Governance in China.
Reviewed by VICTOR SHIH     

The dynamics of federalism,subnational markets and trade policy-making in Canada and the US

Preferential trade agreements are now the dominant trend in the international trading regime. Unlike earlier ‘first generation’ agreements, the new agreements became more comprehensive in their coverage, impinging on areas that are subject to subnational jurisdiction of federal systems. Given constitutionally-prescribed competences allocated to subnational governments, the diversity of interests and sensitivities of subnational entities bring deeply entrenched regulatory practices under scrutiny. Few studies have focused on whether the combination of economic liberalization and political fragmentation will push federal and sub-federal entities to address domestic market fragmentation. We examine whether international market liberalization fosters domestic regulatory and structural reforms to cross-border barriers to trade in Canada and the United States. We show that while the political incentives and functional pressures generated by free trade agreements have fostered attempts at addressing internal market restrictions in Canada, the US has not followed the same path due to weaker mechanisms of intergovernmental coordination.     

Success of a tax amnesty: At the polls,for the fisc?

This paper provides a model for analyzing an individual's voting decision on tax amnesty and the change of his reporting behavior given amnesty is granted/rejected. Success at the polls is predicted to increase with higher penalties meted out to detected evaders while success in terms of reporting would be jeopardized. These and other implications of the model are empirically tested for two Swiss tax amnesty proposals, one rejected, the other approved by a majority of citizens/taxpayers.     

Performance measures in tax administration: Chile as a case study

The article proposes a set of tax administration performance measures and contrasts them with measures actually used by the Chilean tax administration agency. The goals assumed for the tax administration agency (TA) are to maximize tax revenue collection and provide quality services to taxpayers. Ideal performance measures (PMs) would measure the deviation of actual outcome from a best‐practice standard, given the value of all variables affecting organisation performance that are outside management control. The key challenge is to build and calculate these best‐practice outcomes. In Chile the PM in use, for the first goal, is the ratio of actual to potential tax revenue collection. This PM does adjust revenue collection for variations in the tax structure and rate, but it fails to control other variables that affect performance such as the TA budget and per capita income. The PM in use, for the second goal, is taxpayer satisfaction measured through sample surveys. This seems the appropriate PM, as quality of taxpayer services depends directly on the TA efforts to improve them. Copyright © 2005 John Wiley & Sons, Ltd.     

Leader's spiritual intelligence and religiousness: Skills,factors affecting,and their effects on performance (a qualitative study by grounded theory)

Spiritual intelligence has received increasing quantitative research interest, while there is still no attention regarding to investigate spiritual intelligence with applying qualitative methods, especially grounded theory design. This study aimed to detect the skills, affecting factors, and the effects of spiritual intelligence and religiousness on performance. The qualitative analysis of the data collected through the in‐depth interview of the participants after encoding and classification, and the continuous comparison of the data by encoding and data by axes, resulted in these data can be coded in three axes: leader's spiritual intelligence skills, factors that affect leader's spiritual intelligence, and the effects of leader's spiritual intelligence on performance. The results revealed that there are five skills of leader's spiritual intelligence: work‐life balance skill, consists of (5) sub‐skills, leadership transcendence skill includes (6) sub‐skills, leadership meaning and purpose production skill includes (4) sub‐skills, leadership mindfulness skill consists of (9) sub‐skills, and the fifth skill is leadership virtue behavior includes (8) sub‐skills. And also, the results indicated that there are many factors that impact the leader's spiritual intelligence, were classified into three objects: personal (three factors), social and family (two factors), and work factors (4 factors). All participants were agreed unanimously that the leader's spiritual intelligence and religiousness are determined and affect the performance of the leader and his subordinates, these were classified into two objects: The first object is a leader's work‐performance, consisting of (16) indicators, and the second object is a workers performance includes (12) indicators. In light of these results, the study recommended the necessity of developing leaders' awareness of the importance of passion of spiritual intelligence skill and their impacts on performance. Thus, these findings shed new light on the importance of developing leaders' spiritual intelligence skills to resolve leadership problems, and increasing productivity, creativity, and well‐being among leaders and workers in Arab World.     

The role of tax bases and collections costs in the determination of income tax rates,seigniorage and inflation

A growing theoretical literature on optimal taxation predicts that governments will set the tax rates on money holdings and on more traditional tax bases to minimize the deadweight losses of collecting government revenue. Under the presumption that relative collection costs and tax bases have not changed significantly over time, the empirical time-series seigniorage literature has focused on the theory's tax smoothing implication, finding only weak support. We show that changes in collections costs and tax bases played an important role in the determination of tax composition and find stronger support for tax smoothing when this is taken into account.     

Bodo ethnic self-rule and persistent violence in Assam: A failed case of multinational federalism in India

Indian federalism has been credited in the literature on comparative federalism for having successfully resolved many of its ethnic conflicts (in a country of immense ethnic diversity) since 1956 by conceding varied forms of statehood. In most cases, the resolution of ethnic conflict has entailed self-determination for ethno-nationalist groups. There are however cases when the experiment has failed and the institutional arrangements for recognition of ethnic self-determination have given birth to more conflicts and persistent violence. In this article, we argue that the Bodoland Territorial Authority (created in 2003) in Assam is a failed case of multinational federalism in India. We argue that the case of Bodoland illustrates the limits of territorial management when groups are intermixed and highlight the need for power sharing in government and/or non-territorial representation as a better method for managing ethnic conflict in such cases.     

Goods and services tax,cascading, and revenue performance: Analyzing Indian commodity taxation market

Indian economy has finally introduced an improvised value‐added tax commonly known as goods and services tax (GST) with an explicit focus to target cascading. Cascading is by far the most serious issue of a tax structure as it leads to many other challenges like opaqueness, complexity, evasion besides deadweight losses. GST is a fiscal policy reform aimed at integrating and harmonizing the Indian tax structure and hence reduce the incidence of cascading. This study is an attempt to empirically analyze the possible impacts of GST on the cascading and hence revenue collection in the Indian economy. The study has employed a simple but representative simultaneous equation model representing the commodity taxation using time series data from 1990 to 2017. This study finds that reduced cascading under GST will enhance the revenue efficiency of the Indian commodity tax structure. The findings are corroborated by the post‐GST revenue performance of Indian states and the central government.