The Fiscal Organization of Metropolitan Areas: The Allegheny County Case Reconsidered

Is consolidation of local governments within metropolitan areasdesirable? The "traditional reform approach" advocates greaterconsolidation to promote efficiency and equity. However, recentstudies by the U.S. Advisory Commission on IntergovernmentalRelations (ACIR), relying on a "public choice approach," arguethat formally fragmented systems can produce self-determination,citizen choice, competition, fiscal equivalence, accountability,and representation. This study reassesses the evidence presentedin the ACIR study on Allegheny County. While concurring thattraditional reform efforts are poorly conceptualized, the findingsshow that fiscal disparities among Allegheny County municipalitiespersist and have significantly increased over the past decade.These findings, taken together with those from citizen surveys,challenge the conceptual foundations and policy implicationsof both approaches. F or more than half a century, scholars     

The Effects of Fiscal Decentralization on Public Spending: The Korean Case

The local government reforms of the 1980s and 1990s in Korea involved devolution of substantial resources from the central to local governments. Fiscal realignment between the levels of government occurred during the same period of time. This article places these changes within the context of fiscal decentralization, using a variety of time-series regression techniques, in an effort to assess its impact. Findings suggest that fiscal decentralization serves as a constraint on the behavior of central government, while it serves as a booster on behalf of underdeveloped local governments. Fiscal decentralization may be a very effective means of self-government, and plays a key role in improving the fit between the provision of public goods and citizens' demand in Korea.     

How Municipal Property Tax Responded to State Aid Cuts: The Case of Massachusetts Municipalities in the Post‐2001 Fiscal Crisis

This empirical study examines municipal property tax responses to state aid cuts during the post‐2001 fiscal crisis. Using panel econometric techniques on annual changes in property tax levy by 351 incorporated Massachusetts municipalities in the period of 2002–2006, the results suggest that municipal governments offset about 9 cents of each dollar of net state aid cut through the increase of their property tax rates. It contributes to public finance literature on the extent to which local property tax can be used to stabilize municipal revenues when the intergovernmental revenue shrinks.     

Fiscal Policy Learning from Crisis: Comparative Analysis of the Baltic Countries

The experience of a major crisis is often expected to lead to policy learning but the empirical evidence about this is limited. The goal of the paper is to explore comparatively whether the crisis of 2008–2010 has led to fiscal policy learning by civil servants in the three Baltic countries. Despite some differences in the crisis experience, the finance ministry officials in all three countries have identified the same lesson from the crisis: fiscal policy should be counter-cyclical and help to stabilize the economy. The paper also discusses how various factors have influenced policy learning, including the acknowledgment of failure, blame shifting, and analytical tractability.     

The Impact of the Fiscal Crisis on Public Administration Reforms: Comparison of 14 European Countries

Abstract

This study aims to empirically test a widespread assumption that fiscal crises instigate administrative reforms. The empirical analysis relies upon an international comparative study of the responses of 14 European governments to the fiscal crisis of 2008–2013. It is found that fiscal crisis and public administration reforms are not necessarily closely connected. In the majority of cases, the fiscal crisis did not have an instant effect of triggering structural public administration reforms or substantial shifts in existing reform trajectories. The crisis intensified the pressure to reform public administration to some extent, but the European governments’ responses predominantly followed a combination of straightforward cutbacks and incremental change. More substantial reforms were carried out in countries most severely hit by the crisis and/or where administrative reforms were conditioned by international financial assistance.     

Local Option Sales Taxes and Fiscal Disparity: The Case of Georgia Counties

While local option sales taxes (LOST) have become an important revenue source for local governments, there has been concern about the distribution of LOST revenues: the uneven distribution of sales tax bases may have introduced a new source of fiscal inequality and exacerbated existing fiscal disparity. Using Georgia county data (N=159, 1970–2000), this study examines whether and how LOST have affected local fiscal disparity. Our findings suggest that the effects of LOST on fiscal disparity vary with the approach to measure revenue‐raising capacity; thus the issue of LOST distribution is sensitive to the underlying conceptualization of “fiscal equity.”     

The Distributional Politics of Fiscal Adjustment: A Case Study of Four Northeastern States

The federal Tax Reform Act of 1986 and an unexpected economic downturn soon thereafter resulted in a divergence between actual and anticipated revenues at the state level. To cope with the resulting budget deficits, states increased taxes, decreased expenditures, or both. This paper looks at the decisions made in four Northeastern States-New York, Connecticut, New Jersey, and Massachusetts.     

Tax Equity Under Conditions of Fiscal Stress: The Case of the Property Tax

This paper takes a preliminary step toward specifying the relationshipbetween tax equity and fiscal stress by examining property taxassessment uniformity under conditions of fiscal stress. Thedeterminants of assessment uniformity are discussed, leadingto the development of a model of uniformity under conditionsof fiscal strees. The model is tested via cross-sectional regressionanalysis of state data no stress and uniformity. Stress is foundto influence unifomity, but the direction of that influenceis found to depend on the structure of the assessing system.     

The Politics of Fiscal Responses to the Crisis of 2008–2009

The national fiscal responses to the economic crisis of 2008/2009 varied considerably. Some countries reacted with a strong demand stimulus, others intended to slash public expenditures, while a third group pursued mildly expansionary policies. There are strong reasons for governments to pursue a mildly expansionary policy. If governments depart from this default strategy in favor of a significant counter‐cyclical policy, they must be able to swiftly make decisions. Therefore, effective use of counter‐cyclical policy will be unlikely in cases where lengthy negotiations or significant compromises between governing parties with different views on economic and fiscal policy are likely. Therefore, a major determinant of the expansionary strategy is a unified government, usually in form of a one‐party government. If governments opt for pro‐cyclical policy in a major economic crisis, they do so because they have few other viable options. In this situation they tend to shift blame to international organizations.     

Mapping Patterns of Support for Privatization in the Mass Public: The Case of Michigan

This article examines public attitudes about using for-profit firms or nonprofit organizations to deliver public services in Michigan. Using survey data, it shows how the public reacts to the privatization of various state and local government services. It then considers some dimensions of attitudes toward privatization. Finally, it estimates models that predict support for privatization based upon a range of characteristics of respondents to our survey.     

The Salinity Crisis in Western Australia: A Case of Policy Paralysis

This article focuses on the Court government's development of a State Salinity Strategy during the 1990s which took nine years from the initial announcement to the final realease. Western Australia has 70 percent of the nation's dryland salinity, a figure widely regarded as representing a potential environmental disaster with significant flow-on economic and social impacts. The paralysis that has surrounded decision-making on this issue is examined as a case study in the lack of effectiveness of government policy-making capacity on the environment. The shortcomings of the Salinity Strategy examined in the article include a lack of a leadership role for government, inadequate resourcing and weaknesses in the supporting institutional arrangements.     

The Fiscal Consequences of Changing Federal and State Revenue Policies: The Case of Small Oregon Cities

This article examines the fiscal consequences for twelve, smallOregon cities of recent changes in federal and state intergovernmentalrevenue policies. Many small local governments have experienceddouble revenue reverses in recent years—reductions inown-source revenues because of economic decline as well as decreasesin intergovernmental revenues, especially federal aid. The twelvesmall cities are compared with all 241 cities in Oregon andthe 136 Oregon cities in the 1,000 to 49,999 population range.Using aggregate and interview data, a major finding is thatalthough stabilization and/or decline in federal-state revenuesharing and entitlement program funds have accentuated difficultlocal revenue situations, economic decline has been the moreimportant contributor to the fiscal stress of the twelve smallmunicipalities. Most of the twelve cities had limited fiscalcapacity—as indicated by low assessed property valuations—makingit difficult to produce sufficient revenue to meet basic publicservice needs. These cities were also unable to get citizenapproval of increases in property taxes.     

Fiscal Crisis and Community Development: The Great Recession,Support Networks,and Community Development Corporation Capacity

Community development corporations (CDC) are a cornerstone of neighborhood improvement in legacy cities. Yet they face challenges that threaten their financial sustainability, challenges that grew exponentially with the Great Recession. This article examines the impact of the Great Recession on the revenue and survival of CDC in Baltimore, Maryland; Cleveland, Ohio; and Detroit, Michigan. An analysis of financial data from the National Center for Charitable Statistics from 2004 to 2011 highlights issues of industry contraction, revenue concentration and loss, and CDC survival. Interviews and examination of multiple secondary sources of information on CDC activity and support networks in each city further our understanding of the financial results. We find that the CDC industry in all three cities was severely impacted by the Great Recession and that the CDC support networks in each city had a significant intervening effect on the ability of CDC to adapt to the fiscal and service pressures created by the recession. We discuss the implications of the shared trends and the city-specific dynamics for the role of CDC in neighborhood improvement in legacy cities.     

The Impact of Fiscal Policy and Deregulation on Shadow Economies in Transition Countries: The Case of Ukraine

A model of Ukrainian shadow economy moneydemand is estimated that includes newregulatory burden, tax complexity, andsoft-budget constraint variables. Thismodel is analyzed to determine the causesand dynamics of the Ukrainian shadoweconomy and to assess the effectiveness ofstate measures undertaken to reduce itssize. The direct tax burden, thebroadly defined regulatory burden, thecomplexity of the tax system, andsoft-budget constraints for enterprises are found tobe important causes of unofficial activity.The main explanatory factors forthe estimated decline of the shadow economyin recent years are explained and it is argued that theevidence has implications beyond the caseof Ukraine.     

Fiscal Policy,Deficits and Politics of Subnational Governments: The Case of the German Laender

The first part of the paper briefly describesinstitutional aspects of the German federal system andexamines the economic and fiscal performance of theGerman Laender since 1970. Taking into account theinstitutional settings, especially the fact that theGerman Laender cannot set tax rates individually, wedevelop a highly stylized model of subnationalgovernments that do not have access to the tax rateinstrument and thus have to use expenditures as apolicy variable. The model implies an expendituresmoothing policy of subnational governments andcomplements the famous tax smoothing model. Theempirical section examines whether governments ofvarious ideology show significant differences infiscal stabilization policy. Our results indicatethat regional differences in public debt accumulationand public expenditure policy in general is largelydetermined by interregional differences in economicperformance, whereas we do not find any significantimpact on the ideological composition of the Laendergovernments.     

The Impact of Fiscal Crisis on Decision‐Making Processes in European Governments: Dynamics of a Centralization Cascade

The Great Recession resulted in fiscal crises for governments across the Western world. Significant cuts in government programs were initiated as many governments scrambled to reduce their growing budget deficits. This article explores how European governments reacted during the recent crisis. In particular, the authors focus on the interlinkages between shifts toward more centralized decision making. The article uses a survey of thousands of public sector executives in 17 European countries. The authors find evidence of a centralization cascade, such that centralizing one element of the decision‐making process leads to greater centralization throughout the system. Results also show that having a high number of organizational goals and facing clear sanctions for failing to achieve goals lead to greater centralization, but greater organizational commitment reduces the need to centralize.