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Erscheinungsjahr: 
2008
Schriftenreihe/Nr.: 
CESifo Working Paper No. 2280
Verlag: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Zusammenfassung: 
At borders where rich and poor countries meet, services prices differ hugely. In principle, price differentials could be exploited to mutual benefit, offering improved job opportunities to the poor as well as better shopping opportunities to the rich. However, cross-border shopping is often limited by the substantial transaction costs of crossing the border. Moreover, local governments frequently fail to cut these transaction costs even where they have the opportunity to do so. In this paper, we show (i) why a majority of the local electorate often backs this outcome, (ii) how intra-country mobility affects local policy, and (iii) how (inter-) national regulations shape local decisions.
Schlagwörter: 
cross-border shopping
community sorting
regional integration
voting
federalism
JEL: 
F15
H7
R2
D72
Dokumentart: 
Working Paper
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