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Title:Government and Cities: Contests and the Decentralization of Decision Making PDF Logo
Authors:Epstein, Gil S.
Gang, Ira N.
Issue Date:2002
Series/Report no.:IZA Discussion paper series 547
Abstract:Governments do not have perfect information regarding the priorities and the needs of different groups in the economy. This lack of knowledge opens the door for different groups to lobby the government in order to receive the government?s support. We set up a model of hierarchical contests and compare the implications of a centralized allocation process with a decentralized allocation process. We show the potential existence of a poverty trap as a result of fiscal federalism.
Subjects:fiscal federalism
economic models of political processes
contests
rentseeking
intergovernmental relations
JEL:D72
H77
H73
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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