The Italian State,its Regions and the Virus

Italian politics has always been characterised by deep regional divides. While the north and centre are well integrated into the European economy, southern regions struggle to keep up their productivity and employment levels. Although this divide has a long history, the Covid-19 crisis is set to worsen the inequality separating the two parts of the country. This article looks at how the coronavirus pandemic immediately assumed a regional dimension, which was reflected not only in the geography of the contagion, but also in how the central state struggled to manage the contrasting demands coming from northern and southern regions. Although the north has been the epicentre of the health crisis, the south is set to pay the highest economic and social price for the lockdown measures. The conclusion suggests that, while the Covid crisis has confirmed the salience of regional divides for Italian politics, it might also strengthen autonomist forces.     

Managing Carrots and Sticks: Changes in State Administrators' Perceptions of Cooperative and Coercive Federalism During the 1990s

The so-called devolution revolution was a significant themein American federalism in the 1990s. Opinions on the issue varywidely. Some suggest that "major changes" occurred in intergovernmentalrelations. Others were pessimistic about the occurrence of anydevolution during the decade. We investigated changes in intergovernmentalrelations between the national and state governments in the1990s on the basis of Elazar's approach to American federalisminvolving: (1) administration, (2) cooperation and coercion,and (3) regulation. We used American State Administrator's Project(ASAP) data collected in 1994 and 1998 to access state administrators'perceptions of national fiscal and regulatory impacts on stateagencies. We conclude that state administrators' perceptionof national fiscal and regulatory impacts changed only moderatelyfrom 1994 to 1998, and that evolution rather than revolutiondescribes better the character of state-national intergovernmentalchanges during the 1990s.     

The Changing Property Tax in the West: State Centralization of Local Finances

Diminished local government autonomy and increased fiscal centralization in the hands of state government are the consequences of the restrictions on the local property tax imposed in the western states in the past twenty years. While the trend is a national one, it is more evident in the West than in other regions. Statewide voter initiatives account for some of the restrictions, particularly the more severe ones, but legislatures and governors also impose these limitations. In tracing the recent course of the centralization of local finance, this article details the property tax restrictions adopted in individual western states, examines the initiative and conventional legislative sources of these actions, and provides quantitative and qualitative evidence for the centralization thesis. In many western states the property tax has lost much of its local character, becoming in large part a fiscal and political tool for state policymakers.     

Partisan Politics,Globalization, and the Determinants of Privatization Proceeds in Advanced Democracies (1990–2000)

The 1990s have witnessed unprecedented attempts at privatizing state‐owned enterprises in virtually all OECD democracies. This contribution analyzes the extent to which the partisan control of the government can account for the differences in the privatization proceeds raised by EU and OECD countries between 1990 and 2000. It turns out that privatizations are part of a process of economic liberalization in previously highly regulated economies as well as a reaction to the fiscal policy challenges imposed by European integration and the globalization of financial markets. Partisan differences only emerge if economic problems are moderate, while intense economic, particularly fiscal, problems foreclose differing partisan strategies.     

State Policies Affecting Cities and Counties in 1991: Shifting Federalism

States experienced considerable fiscal distress in 1991 as the recession led to widespread revenue shortfalls. In this environment, discretionary spending did not fare well. This article discusses five major policy areas: (1) state financial aid; (2) major changes in the "sorting out" of responsibilities between the state and local governments; (3) revenue diversification; (4) changes in limitations imposed on local taxes; and (5) new mandates handed down to cities and counties.     

Effects of the Form of Government and Property Tax Limits on Local Finance in the Context of Revenue and Expenditure Simultaneity

This paper examines the impact of the form of government and state‐imposed property tax limits on municipal finance. We suggest that municipal revenues and expenditures are determined concurrently and estimate revenue and expenditure functions as simultaneous equations. We use the instrumental variable approach and fixed effects to address revenue and expenditure endogeneity. By testing the model on a cross‐section of rich municipal data for fiscal year 2002, we find evidence that revenues and expenditures are simultaneously determined, that potentially binding state‐imposed property tax limits effectively restrict local revenues and that the form of government is a significant predictor of local expenditures.     

State Tax Cuts of 1995: Is Something New Afoot?

Perhaps the hottest fiscal topic in state capitals in 1995 was tax cuts. When legislatures convened in January, it appeared possible that states were on the verge of an unprecedented wave of tax cuts. The Republican landslide of November 1994 swept into office many new governors and legislators who had campaigned on reducing taxes. Governor Christine Todd Whitman of New Jersey was considered a role model by many of them. Perhaps state tax policy was about to take a major new direction. According to some reports, that is precisely what happened. For example, Stephen Moore, Director of Fiscal Policy Studies at the Cato Institute, wrote the following introduction to his overview of state tax policies:1 1995 is shaping up to be the biggest tax-cutting year in more than 10 years…. [T]he supply side philosophy that low tax rates and expenditure controls are the key fiscal tools to state economic competitiveness now appears to be the new governing philosophy in state capitals from Albany to Sacramento. The Pete Wilson, Lowell Weicker, Jim Florio soak-the-rich philosophy of the early 1990s has been nearly universally repudiated across the states. Meanwhile, “Whitmanomics,” named after tax-cutting Christine Todd Whitman of New Jersey, is spreading rapidly to other states. In fact, there was a wave of state tax cuts in 1995 with about half of the states enacting reductions of some kind. But it appears premature to draw the strong conclusion that this marked a radical change in state fiscal policy. State legislatures trimmed or rejected most of the proposals for large tax cuts. Most of the 1995 tax cuts were small or modest in size Rather than a new departure, they are consistent with past policies at similar points in the business cycle. It is also possible, however, that something new really is afoot. Conservative anti-tax forces are gaining strength in the states, just as they are at the federal level. If it were not for prospective federal aid cuts, state tax policy really might become more conservative. But the shift of federal responsibilities to states will represent a formidable obstacle to large state tax cuts in the coming years. This article places the tax cuts of 1995 in perspective. It begins with a detailed discussion of ambiguities'in defining and measuring tax reductions and increases. This discussion can be applied to any time period and will remain relevant after concern     

Central Decisions,Decentralized Solutions: Comparing the Implications of Central Cutback Policy for the Agency Level in Estonia and Latvia

Abstract

The paper investigates the implications of governmental cutback strategies related to the recent fiscal crisis at agency level in Estonia and Latvia. For this purpose, the article applies a comparative case study approach, through a purposeful selection of five agencies – three in Estonia and two in Latvia – to map the maximum possible variation of before-and-after effects of the crisis on organizational responses and individual-level coping. The selected agencies represent a range of regulatory and social policy domains directly and severely affected by the crisis through budget cuts and increased demand for services, and therefore most affected by the crisis. The study demonstrates that the budget cuts imposed by the cabinets of both countries and widely praised internationally actually left agency-level actors in an extremely difficult situation. Centrally imposed across-the-board cuts resulted in diverse public service gaps, leading to a range of hardships for the citizens, and therefore turning out to be neither equal nor fair for the target groups. The study concludes that centrally decided cutbacks shifted the burden to street-level bureaucrats, who in turn took on the role of key policy actors by ensuring the delivery of public services during the fiscal crisis.     

Demokratie als öffentliches Gut?

Political Science neglect classical insights on constitutional and economic conditions of the so called “tax state” as a fiscal institutional architecture sui generis. While studies in Political Economy focus on distribution quality of the welfare state or compare budgets from local to international level fiscal research should also consider the capitalist structure of tax paradigm again. Only after such a regeneration the discipline could better reflect old and new democratic challenges of fiscal problems. Recalling former theories of interdependencies between fiscal, constitutional and ideological orders, this article suggests to make sense of conceptualizing democratic regime itself as prime public good. Because if it is fiscal sovereignty that is foremost to produce with democracy’s budget it should be easier to analyze tax state driven regressive effects of democratic integrity.     

How State Capacity Varies within Frontier States: A Multicountry Subnational Analysis

While there is a growing literature on state formation and the rise of state capacity over time, this literature typically deals with differences between countries, neglecting the fact that state formation also occurs differentially within a country over time. This article examines legacies of state formation spatially, by looking at variation within “frontier” states—countries that in recent centuries have extended rule over new territories adjacent to their core regions. Frontier zones are found to have ongoing lower levels of public order and deficient public goods provision. Several theories are examined to explain this discrepancy, including internal resettlement, costs of monitoring and enforcement, and the relationship between settlers and the indigenous population. It is argued that the formation of strong social institutions among settlers leads to resistance to attempts to impose governance over frontier regions, and to “select for” lower fiscal capacity and lower provision of public goods.     

On the political and fiscal determinants of income redistribution under federalism and democracy: evidence from Germany

Several recent studies suggest that transfers from central to regional governments are motivated by political considerations. In this paper we examine if this is also the case for transfers from regional to central governments in the context of the German fiscal equalization system. We examine the factors that contribute to differences in tax revenues across German states. The evidence indicates that both fiscal incentives and political factors can explain these differences, although in Germany the former are more important. Moreover, accounting for fiscal institutions has important consequences for the empirical assessment of political influences on taxation. Overall we find that the political affiliation of the state governor is an important factor in explaining differences in state tax revenues. Thus, the right-wing party (CDU/CSU) is effective in relaxing the tax burden at the state level. In contrast, partisan alignment between the state government and the federal government loses its importance once fiscal conditions enter the empirical model.     

Analyzing the Fiscal Health of State Governments in India: Evidence from the 14 Major States

The paper seeks to assess the fiscal sustainability of the 14 major State (subnational) governments in India employing the deficit indicators approach. Evidence from the 14 States indicates to a deep fiscal stress across rich and poor States with just a third of the States showing a sustainable revenue account and primary revenue balance and even fewer States showing a sustainable primary deficit thereby reinforcing the serious concern for State‐level (subnational) fiscal health as weak State finances can have an impact on the stability of overall government finances.     

The Evolution of Expenditure Budgeting in Australia

This paper examines the evolution of expenditure budgeting in Australia, at both the federal or commonwealth and state levels. The paper begins with a brief constitutional and fiscal overview, goes on to examine the evolution of expenditure budgeting at the commonwealth level over the 1970s, continues with a discussion of innovations in expenditure budgeting at the state level in the late 1970s, and concludes with a comparative assessment of the state of expenditure budgeting in Australia.     

The electoral consequences of austerity: economic policy voting in Europe in times of crisis

Abstract

Voters typically observe macroeconomic outcomes in order to evaluate government performance. However, during crises, when the clarity of economic responsibility is poor and the economy is in recession, citizens need additional sources of information in order to form a reasoned opinion. Government policy response is one such source. This study shows on a sample of 24 European nations from 2004, 2009 and 2014 that in the post-crisis period, economic policies have emerged as one of the key predictors of vote choice, with government decisions to pursue fiscal austerity leading to significantly lower levels of incumbent support. Furthermore, the paper tests the possibility that the effect of austerity is conditioned by the clarity of responsibility. In multilevel systems, where policies are externally imposed, voters could be expected to hold incumbents less accountable for unpopular measures. The analysis, however, provides no evidence that policy effects depend on the extent to which national governments share policy responsibilities with supranational and intergovernmental institutions. Accountability for policy actions is primarily attributed at the domestic level as voters are able to identify the decisional role of national governments.     

Austerity Regimes at the Local Level: Examining Fiscal Effects of Austerity Commissioners Using a Time-Series Synthetic Control Method

Abstract

From a democratic perspective, the replacement of government or parliament by a public manager to enforce budget discipline marks a serious intervention. Transferred to the local level, the replacement of the mayor and the council in three German municipalities by a state official (a so-called state commissioner) in recent years has raised questions about the legitimacy and adequacy of such a strong interventionist instrument. One crucial answer to be given to this legitimacy issue concerns effectiveness, in other words whether the instrument can fulfill its designated task by improving the local fiscal situation since the fiscal success of the commissioner is a basic prerequisite for legitimacy. By using a time-series approach of the synthetic control method (SCM) and constructing a synthetic comparison case to the town of Altena, an answer regarding the commissioner’s potential to reduce the short-term debt can be given. The commissioner was successful in limiting the debt increase and seems to have reversed the debt trend. This finding supports the effectiveness of rather hierarchical instruments for ensuring fiscal discipline at the local level and thereby adds to broadening the international public management literature on municipal takeovers.     

Locke, Sincerity and the Rationality of Persecution

According to the most influential contemporary reading of John Locke's Letter Concerning Toleration (1689), his main argument against religious persecution is unsuccessful. That argument holds that coercion is ineffective as a means of instilling religious beliefs in its victims. I propose a different reading of the Letter . Locke's main consideration against persecution is not the unsuccessful belief-based argument just outlined, but what I call the sincerity argument . He believes that religious coercion is irrational because it is ineffective as a means of inculcating the right intentions in people. Once this alternative argument is placed at its centre, the Letter is seen to be a more fertile source of political argument than is suggested by alternative readings. In particular, the sincerity argument gives us a powerful reason for rejecting state moral paternalism, the doctrine that the state may use coercion to make people morally virtuous. If moral virtue depends upon people having the right intentions, and if coercion is ineffective as a means of instilling the right intentions in people, then state moral paternalism is ineffective and hence irrational.     

Negotiating universalism in India and Latin America: Fiscal decentralization,subnational politics and social outcomes

ABSTRACT

This is the introductory paper for a special issue which focuses on an exploration of how vertical inter-governmental political and fiscal bargains and horizontal variation in political, social and economic conditions across regions contribute to or undermine the provision of inclusive and sustainable social policies at the subnational level in Latin America and India. The papers incorporate both federal, as well as decentralized unitary states, pointing to common political tensions across unitary and federal settings despite the typically greater institutionalization of regional autonomy in federal countries. Jointly, the papers examine the territorial dimension of universalism and explore, in greater and empirical detail, the causal links between fiscal transfers, social policies and outcomes, highlighting the political dynamics that shape fiscal decentralization reforms and the welfare state. This introductory essay reviews existing scholarship, and highlights the contribution of the special issue to understanding these issues beyond OECD contexts.     

Examining the Canadian Government's Resistance to Including Socioeconomic Concerns in Genetically Modified Seeds Regulation: A Policy Transfer and Multilevel Approach

In 2011, Canadian Members of Parliament refused to transfer a regulatory initiative taken from Argentina that would have required an analysis of potential harm to export markets before authorizing the sale of any new genetically modified seed. This was the purpose of Bill C‐474, which was defeated in the House of Commons. After exploring Argentina's regulatory framework as a source of transfer, this paper combines a multilevel analysis with a typology of policy transfer mechanisms in order to address the complexities underlying this unsuccessful attempt. We explore how the mechanisms of competition and coercion might have impeded the transfer of such an initiative at the international and the macro‐state levels. Moreover, while a policy transfer network in support of the bill called on previous experiences with genetically modified seeds, their efforts appear to have been outweighed by another network using arguments based on the mechanisms of competition, coercion, and mimicry.     

Intergovernmental Structure and Fiscal Management Strategies: A Crossnational Analysis

Does intergovernmental structure have a systematic effect on the impacts of local governments' fiscal policy responses? Using empirical data from more than 800 local governments in five countries, the article concludes that intergovernmental structure is associated with the impact attributed to various fiscal management strategies. Such strategies have generally had greater impact in local governments in federal systems than those in unitary state systems. There are similarities between federal and unitary local governments regarding the fiscal management strategies that have least impact, and both types stress the importance of productivity gains via technology. But the differences in relative importance and level of impact are more striking than the similarities. In particular, fiscal management strategies involving the relations of the local government with other governments, such as obtaining intergovernmental revenue and shifting service provision to other governments, have greater impact in significantly more federal systems than in unitary state systems. These federal local governments also experience greater impacts from increasing user charges and raising local taxes. In contrast, local governments in unitary state systems place greater reliance on the more politically expeditious strategy of across–the–board expenditure reductions and on reductions of capital spending. These findings suggest that local governments in more decentralized systems have greater flexibility to manipulate relations with other governments in order to enhance their own fiscal situation. The data also suggest that the government's level of fiscal stress is not systematically associated with the level of impact from most fiscal management strategies, especially in the unitary state systems.     

Testing Structuralist and Interpretative Explanations of Policy Change: The Case of Italy's Budget Reform

This article compares the relative explanatory power of structuralist and interpretative approaches to the study of policy change. By assessing the fit of these approaches against the actual reform of the formulation, approval, and implementation stages of Italy's budget process in the 1990s, the article shows that structural factors (such as fiscal pressures and changes in the electoral rules) played a key role in the reform of the formulation stage but not in that of the approval and implementation stages, where the content of reform followed the managerialist paradigm endorsed by the Italian reform community. Italy in the 1990s was under considerable pressure to achieve fiscal retrenchment, and the managerialist paradigm advocated measures that were largely antithetical to those that can be deduced from the changes in institutional context. Thus, the Italian case provides an excellent opportunity to assess the relative causal impact of ideas and structure on reform.