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on Public Economics |
| By: | Rainald Borck (University of Munich and DIW Berlin); Marco Caliendo (DIW Berlin, IAB Nuremberg and IZA Bonn); Viktor Steiner (Free University of Berlin, DIW Berlin and IZA Bonn) |
| Abstract: | In this paper, we consider fiscal competition between jurisdictions. Capital taxes are used to finance a public input and two public goods, one which benefits mobile skilled workers and one which benefits immobile unskilled workers. We derive the jurisdictions’ reaction functions for different spending categories. We then estimate these reaction functions using data from German communities. Thereby we explicitly allow for a spatially lagged dependent variable and a possible spatial error dependence by applying a generalized spatial two-stage least squares (GS2SLS) procedure. The results show that there is significant interaction between spending of neighbouring counties in Germany. |
| Keywords: | tax competition, capital skill complementarity, public spending, spatial econometrics |
| JEL: | H77 J24 J61 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2428&r=pbe |
| By: | Martin Halla (Department of Economics, Johannes Kepler University Linz, Austria); Friedrich G. Schneider (Department of Economics, Johannes Kepler University Linz, Austria) |
| Abstract: | Economists have studied many aspects of tax evasion. The vast literature has concentrated on the individual taxpayer’s decision on avoiding taxes by underreporting income. However no comprehensive investigation of the individual taxpayer’s decision on claiming unjustified subsidies (e. g. by underreporting income) exists so far. Employing Austrian survey data we show that the basic attitude towards avoiding taxes (tax morale) and claiming unjustified subsidies (benefit morale) have different determinants. Our applied econometric framework relaxes the often stated assumption of the exogeneity of income as an explaining variable of tax morale. Furthermore we find empirical evidence that tax morale and benefit morale have different impact on actual behavior: Whereas a low benefit morale leads indeed to unjustified claims on benefits and therefore to higher income, we find no statistically significant effect of tax morale on tax evasion. These different determinants and effects of tax morale and benefit morale can be explained by differences in the deterrence factors from the traditional economic approach, by alternative theories or simply by more opportunities to cheat on the state by unjustified subsidies in contrast to avoiding taxes. |
| Keywords: | tax; subsidies; tax morale; benefit morale; tax evasion; benefit fraud |
| JEL: | H20 H26 |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2005_05&r=pbe |
| By: | Conesa, Juan Carlos; Kitao, Sagiri; Krüger, Dirk |
| Abstract: | In this paper we quantitatively characterize the optimal capital and labor income tax in an overlapping generations model with idiosyncratic, uninsurable income shocks, where households also differ permanently with respect to their ability to generate income. The welfare criterion we employ is ex-ante (before ability is realized) expected (with respect to uninsurable productivity shocks) utility of a newborn in a stationary equilibrium. Embedded in this welfare criterion is a concern of the policy maker for insurance against idiosyncratic shocks and redistribution among agents of different abilities. Such insurance and redistribution can be achieved by progressive labor income taxes or taxation of capital income, or both. The policy maker has then to trade off these concerns against the standard distortions these taxes generate for the labor supply and capital accumulation decision. We find that the optimal capital income tax rate is not only positive, but is significantly positive. The optimal (marginal and average) tax rate on capital is 36%, in conjunction with a progressive labor income tax code that is, to a first approximation, a flat tax of 23% with a deduction that corresponds to about $6,000 (relative to an average income of households in the model of $35,000). We argue that the high optimal capital income tax is mainly driven by the life cycle structure of the model whereas the optimal progressivity of the labor income tax is due to the insurance and redistribution role of the income tax system. |
| Keywords: | capital taxation; optimal taxation; progressive taxation |
| JEL: | E62 H21 H24 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5929&r=pbe |
| By: | Adam Geršl (Czech National Bank, Monetary and Statistics Department, Prague, Czech republic; Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic; Czech National Bank, Prague) |
| Abstract: | The paper uses a dynamic inconsistency model known from monetary policy to assess three alternative proposals how to reform fiscal constitution in order to limit government’s incentive to use fiscal policy for maximizing political support. The return to ever-balanced-budget rule, state-contingent rules, and the establishment of an independent Fiscal Policy Committee with power to set public deficit with the aim of stabilizing the economy are discussed from the constitutional perspective, analyzing different incentives that these proposals create for government and alternative means to enhance credibility of the arrangement. |
| Keywords: | fiscal policy; dynamic inconsistency; political economy; public deficit |
| JEL: | E61 E63 P16 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp098&r=pbe |
| By: | Johansson, Lars (Dept. of Economics, Stockholm University) |
| Abstract: | The number of people living with HIV is alarmingly large. In addition to the incomprehensible human suffering of those directly affected, AIDS also has large, negative economic effects. In this paper, I study the fiscal implications of the HIV/AIDS epidemic in South Africa in a standard neo-classical growth model. I find that an antiretroviral program is to a large extent self financing. Improvement in dependency ratios and health care cost savings would pay for Rand 144 billion of a full epidemiological intervention. The indirect effect through the changing demographic structure will be more important than the direct health care cost saving effect. I also explore different taxation policies. The households would be willing to sacrifice an amount equal to 12% of GDP in the first period to be subject to an optimal (Ramsey) fiscal policy rather than an alternative fixed debt to GDP policy. The optimal policy implies an increase in government debt during the peak of the epidemic. |
| Keywords: | AIDS; Fiscal Impact; Economic Impact; Fiscal Policy; Taxation |
| JEL: | E17 E21 E23 E62 H21 H23 |
| Date: | 2006–12–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2006_0011&r=pbe |
| By: | Peter Tuchyňa (Center for Economic Research and Graduate Education-Economics Institute, Prague, Czech Republic); Martin Gregor (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic) |
| Abstract: | When local public goods are provided by a centralized authority, spillovers may be coordinated, but heterogeneity in preferences may be suppressed. Besley and Coate (2003) have already solved this classic trade-off for a uniform tax regime. Here, we extend their approach by allowing for a non-uniform tax regime. We find that centralization with our tax system necessarily increases welfare in comparison to uniform-tax centralization. Importantly, with non-cooperative legislators coming from homogenous districts, our centralization dominates decentralization for any degree of spillovers. In other cases, it at least improves odds of centralization, if measured by utilitarian yardstick. |
| Keywords: | Decentralization; Local Public Goods; Distributive Politics; Political Economy |
| JEL: | H40 H70 H72 P51 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp081&r=pbe |
| By: | Rupert Sausgruber (Department of Public Economics, University of Innsbruck); Jean-Robert Tyran (Department of Economics, University of Copenhagen) |
| Abstract: | We study pure redistribution as a device to increase cooperation and efficiency in the provision of public goods. Experimental subjects play a two-stage game. The first stage is the standard linear public goods game. In the second stage, subjects can redistribute payoffs among other subjects in their group. We find that cooperation and efficiency increases substantially with this redistribution scheme, and that the redistribution option is popular. Our results provide an intuitive explanation for why an imposed redistribution rule, as proposed by Falkinger (1996), is capable of sustaining cooperation in the provision of public goods. |
| Keywords: | experiment; public goods; redistribution |
| JEL: | C9 H41 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuiedp:0624&r=pbe |
| By: | Ulrich Oberndorfer (ZEW Mannheim); Viktor Steiner (Free University Berlin, DIW Berlin and IZA Bonn) |
| Abstract: | We analyze potential effects of demographic change and political constellations on higher education spending. In our panel analysis of west German states (Laender) for the period 1985 to 2002 we find empirical evidence for the hypothesis of a negative relationship between demographic aging and spending on public higher education. In contrast to the hypothesis of the classical partisan theory that implies higher public expenditures under leftist parties, we find that governments under conservative parties or a coalition between social democrats and conservatives spend more on public higher education than governments run by the social-democratic party alone. |
| Keywords: | demographic change, public higher education spending, partisan politics |
| JEL: | H52 H72 I22 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2417&r=pbe |
| By: | Keiko Honjo; Dennis P. J. Botman |
| Abstract: | This paper examines the macroeconomic effects of different timing and composition of fiscal adjustment in the United Kingdom using the IMF’s Global Fiscal Model. Early consolidation dampens aggregate demand in the short term, but increases output in the long term as smaller primary surpluses are needed as a result of lower interest payments. Reducing government transfers or current government spending provides larger gains than increasing taxes, in particular compared to raising corporate or personal income taxes. We show that these conclusions are robust under alternative behavioral assumptions and parameterizations. A reduction in global saving would make early consolidation more urgent from both cyclical and long-term perspectives. Finally, we show that tax reform aimed at increasing incentives to save could provide support to fiscal consolidation measures. |
| Date: | 2006–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:06/89&r=pbe |
| By: | Martin Weale |
| Abstract: | We assess the implications of demographic uncertainty for the budgetary position in Belgium, Denmark, Finland, Germany, the Netherlands, Spain and the United Kingdom. We evaluate the frequency distribution of the increase in taxes needed to deliver fiscal solvency. |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:nsr:niesrd:279&r=pbe |
| By: | Giannitsarou, Chryssi; Scott, Andrew |
| Abstract: | The intertemporal budget constraint of the government implies a relationship between a ratio of current liabilities to the primary deficit with future values of inflation, interest rates, GDP and narrow money growth and changes in the primary deficit. This relationship defines a natural measure of fiscal balance and can be used as an accounting identity to examine the channels through which governments achieve fiscal sustainability. We evaluate the ability of this framework to account for the fiscal behaviour of six industrialised nations since 1960. We show how fiscal imbalances are mainly removed through adjustments in the primary deficit (80-100%), with less substantial roles being played by inflation (0-10%) and GDP growth (0-20%). Focusing on the relation between fiscal imbalances and inflation suggests extremely modest interactions. This post WWII evidence suggests that the widely anticipated future increases in fiscal deficits, need not necessarily have a substantial impact on inflation. |
| Keywords: | fiscal deficit; fiscal sustainability; government debt; inflation; intertemporal budget constraint |
| JEL: | E31 E62 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5961&r=pbe |
| By: | Rolf Aaberge (Statistics Norway and IZA Bonn); Ugo Colombino (University of Turin and Statistics Norway) |
| Abstract: | The purpose of this paper is to present an exercise where we identify optimal income tax rules under the constraint of fixed tax revenue. To this end, we estimate a microeconomic model with 78 parameters that capture heterogeneity in consumption-leisure preferences for singles and couples as well as in job opportunities across individuals based on detailed Norwegian household data for 1994. For any given tax rule, the estimated model can be used to simulate the choices made by single individuals and couples. Those choices are therefore generated by preferences and opportunities that vary across the decision units. Differently from what is common in the literature, we do not rely on a priori theoretical optimal taxation results, but instead we identify optimal tax rules - within a class of 6-parameter piece-wise linear rules - by iteratively running the model until a given social welfare function attains its maximum under the constraint of keeping constant the total net tax revenue. We explore a variety of social welfare functions with differing degree of inequality aversion and also two alternative social welfare principles, namely equality of outcome and equality of opportunity. All the social welfare functions turn out to imply an average tax rate lower than the current 1994 one. Moreover, all the optimal rules imply - with respect to the current rule - lower marginal rates on low and/or average income levels and higher marginal rates on relatively high income levels. These results are partially at odds with the tax reforms that took place in many countries during the last decades. While those reforms embodied the idea of lowering average tax rates, the way to implement it has typically consisted in reducing the top marginal rates. Our results instead suggest to lower average tax rates by reducing marginal rates on low and average income levels and increasing marginal rates on very high income levels. |
| Keywords: | labour supply, optimal taxation, random utility model, microsimulation |
| JEL: | H21 H31 J22 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2468&r=pbe |
| By: | M. Magnani |
| Abstract: | Local public good provision from different government levels is subject to many bias coming from the political process; incentives indeed, vary with the size of the beneficiaries’ set and costs may affect the results of political competition by reducing total resources available for redistribution. Present work represents a first attempt to look at these issues together; indeed, it considers the situation where politicians have a finite budget to use both for redistributive policies and for the provision of a public good that affects the utility of a fraction of the electorate. In this setting it is not enough that benefits balance costs, in order for the public good to be implemented; the required level of efficiency moreover, is influenced by benefits concentration. If those interested in the public good are less than half of the electorate, concentration increases the efficiency threshold; on the contrary if they amount for more, benefits concentration decreases the required level of efficiency. Classification-JEL: D72, H41 |
| Keywords: | social security, turnover on the labor market, political equilibria, employment protection, retirement age |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:par:dipeco:2006-ep13&r=pbe |
| By: | Lars-Erik Borge (Department of Economics and Centre for Economic Research, Norwegian University of Science and Technology) |
| Abstract: | Compared with most countries the Norwegian system of financing local governments is highly centralized. Grants make up a substantial part of revenues and local taxes are highly regulated by the center. The development of the system was motivated by a desire to equalize service provision throughout the country. The purpose of this paper is to analyze possible consequences of more decentralized financing with local tax discretion. Contrary to the conventional wisdom the analysis indicates that decentralized financing is likely to give more equal provision of local public services. In addition, substantial efficiency gains can be obtained. |
| Keywords: | Centralized financing; Decentralized financing; Tax discretion; Efficiency gains; Equalization |
| JEL: | D61 H71 H72 |
| Date: | 2006–12–06 |
| URL: | http://d.repec.org/n?u=RePEc:nst:samfok:7806&r=pbe |
| By: | Nielsen, Soren Bo; Raimondos-Møller, Pascalis; Schjelderup, Guttorm |
| Abstract: | We examine how a multinational's choice to centralize or de-centralize its decision structure is affected by country tax differentials. Within a simple model that emphasizes the multiple conflicting roles of transfer prices in MNEs - here, as a strategic pre-commitment device and a tax manipulation instrument - we show that decentralization is preferred in case of small tax differentials, whereas centralization can be more profitable, when tax differentials are large. In essence, the organizational flexibility of MNEs is triggered by the scope for tax minimization. Our analysis allows for both commitment and non-commitment to transfer prices, and for alternative modes of competition. |
| Keywords: | centralized vs. de-centralized decisions; MNEs; taxes; transfer prices |
| JEL: | F23 H25 L23 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5952&r=pbe |
| By: | Paul Makdissi; Stéphane Mussard |
| Abstract: | For any given order of stochastic dominance, standard concentration curves are decomposed into contribution curves corresponding to within-group inequalities, between-group inequalities, and transvariational inequalities. We prove, for all orders, that contribution curve dominance implies systematically welfare-improving tax reforms and conversely. Accordingly, we point out some undesirable fiscal reforms since a welfare expansion may be costly in terms of particular inequalities. |
| Keywords: | Concentration curves, Contribution curves, Stochastic dominance, Tax reforms |
| JEL: | D63 H20 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:lacicr:0641&r=pbe |
| By: | Ondřej Schneider (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Jan Zápal (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic) |
| Abstract: | The European Union (EU) accepted ten new member states (NMS) in 2004. These countries, mostly former socialist countries, have had to adjust their economic policies to the EU’s standards. Perhaps most difficult has proven to be fiscal policy whereby NMS must comply with the Stability and Growth Pact (SGP) rules. Indeed, six out of the ten NMS have breached the SGP limits and were put in Excessive Deficit Procedure (EDP). While the SGP is being modified, fiscal policy is set to remain on the agenda for all NMS in years to come. In this paper, we analyse fiscal policy in the NMS, focusing primarily on time period that immediately preceded their EU accession. We analyse the structure and scale of these countries’ fiscal policy and identify main trends in revenues and expenditures of their public budgets. We then explore dynamics of fiscal policy in the new member states and isolate main factors of the dynamics. Namely, we show how much of the consolidations was due to the fiscal authorities’ effort and how much was caused by external factors. We also show that most NMS’ governments have run rather inconsistent fiscal policy and have not consolidated their budgets appropriately by postponing politically difficult consolidation measures. However, we also identify a group of countries characterised by strong reform efforts and responsible fiscal policy making, supported usually by strong economic growth. In this context, room is given to economic, as well as political economy factors. |
| Keywords: | Fiscal Policy; New Member States; Consolidations; Stability and Growth Pact; Excessive Deficit Procedure; Growth Accounting; Probit Analysis. |
| JEL: | E6 E62 H6 H87 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp076&r=pbe |
| By: | Petr Hedbávný (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Ondřej Schneider (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Jan Zápal (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic) |
| Abstract: | In this paper, we set out to examine an efficient fiscal-policy framework for a monetary union. We illustrate that fiscal policy’s bias toward budget deficit only temporarily ceased at the end of the 20th century as European countries endeavored to qualify for euro-zone membership, which compelled strict limits on budgetary deficits. We then explore which mechanisms might instill a sense of fiscal disciple in governments. We find that most mechanisms suffer from the incentive-incompatible setup whereby governments restrict their own fiscal-policy freedom. We argue that even multilateral fiscal rules, such as the EU’s Stability and Growth Pact, suffer from the same endogeneity flaw. Consequently, we argue that a fiscal rule must incorporate an external authority that would impartially assess fiscal-policy developments. Using U.S. debt and bond-market data at the state level, we show that financial markets represent a good candidate as, vis-á-vis the American states, they do differentiate state debt according to the level of debt. We thus argue for a fiscal institution - what we call the Fiscal Sustainability Council - that would actively bring financial markets into the fiscal-policy process, and we explain the technique whereby this could be effected. |
| Keywords: | fiscal policy; European Union; sustainability |
| JEL: | E6 H6 H87 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp079&r=pbe |
| By: | Naomi E. Feldman; Peter Katuscak |
| Abstract: | Economic theory assumes that taxpayers use their true marginal tax rate (MTR) to guide their economic decisions. However, complexity of the personal income tax system implies that taxpayers may incorrectly perceive true marginal prices and incentives. We first develop an updating model that formalizes this proposition. A prediction of this model is that an unexpected innovation in the previous year's average tax rate (ATR) influences the perception of the MTR in the current year, even though the MTR is not in fact changing between the two years. This model generalizes the \schmeduling" hypothesis of Liebman and Zeckhauser (2004), who suggest that taxpayers use the ATR in place of the MTR in making their decisions. Then, assuming that taxpayers react to their perceived after-tax price as economic theory would suggest, we test this prediction empirically by examining whether household labor income responds to predictable (but not necessarily predicted) variation in the previous year's ATR due to eligibility for the Child Tax Credit, which depends on the exact timing of a child's 17th birthday. We find that household labor income decreases in response to losing eligibility for the Child Tax Credit. This finding is inconsistent with the rational taxpayer hypothesis, but consistent with the schmeduling hypothesis. Our robustness tests do not provide any consistent evidence that this result is entirely driven by an omitted variable bias due to a direct timing of birth effect. We also discuss the welfare consequences of schmeduling. |
| Keywords: | Tax, labor supply, average tax. |
| JEL: | H21 H24 H31 |
| Date: | 2006–09 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp304&r=pbe |
| By: | Friedrich G. Schneider (Department of Economics, Johannes Kepler University Linz, Austria); Benno Torgler (Whitney and Betty MacMillan Center for International and Area Studies, Yale University) |
| Abstract: | Considerable evidence suggests that enforcement efforts cannot fully explain the high degree of tax compliance. To resolve this puzzle of tax compliance several researchers have argued that citizens’ attitudes toward paying taxes defined as tax morale helps to explain the high degree of tax compliance. However, most studies have treated tax morale as a black box without discussing which factors shape it. Additionally, the tax compliance literature provides little empirical research that investigates attitudes toward paying taxes in Europe. Thus, this paper is unique in its examination of citizen tax morale within three multicultural European countries, Switzerland, Belgium and Spain, a choice that allows far more detailed examination of the impact of culture and institutions using datasets from the World Values Survey and the European Values Survey. |
| Date: | 2006–07 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2006_08&r=pbe |
| By: | Ondřej Schneider (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Jan Zápal (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic; London School of Economics and Political Science) |
| Abstract: | In this paper, we track behaviour of fiscal authorities of the ten new EU member states (NSM) in the period which immediately preceded their EU accession. We first present basic stylized facts about public budgets of those countries. The paper then analyses reasons which led to periods of fiscal consolidations in NMS. Secondly, we also present evidence from Pre-Accession Economic and Convergence programmes of NMSs concerning planed steps of fiscal authorities and try to contrast them with reality. Throughout the paper, we identify two different groups of countries which significantly differ in their fiscal behaviour. On the one side is group of Baltic countries displaying strong reform effort and responsible fiscal policy usually supported by strong economic growth. On the second extreme, we identify fiscally irresponsible central European countries and two Mediterranean islands displaying lax fiscal policies and little political will to implement costly reforms. Somewhere between stand Slovenia and Slovakia, first without strong reform performance yet with budget deficit in compliance with Stability and Growth Pact and later for its recent reform efforts. Our key finding concerning behaviour of fiscally irresponsible group of countries is that their current problems with high budget deficits originate in their lax approach and inability to implement politically costly expenditure cuts which is apparent from their revision of budget plans and endeavour to shift envisioned deficit reduction into the future. Yet, this strategy has led those countries to uncomfortable position vis-a-vis European fiscal rules. |
| Keywords: | fiscal policy; new member states; consolidations; Stability and Growth Pact; Excessive Deficit Procedure; Convergence Programmes banking |
| Date: | 2006–06 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2006_13&r=pbe |
| By: | Paul Makdissi; Stéphane Mussard |
| Abstract: | In this paper, we propose the conception of within-group CD-curve, to apprehend the impact of indirect tax reforms on truncated distributions of consumption expenditures. This confers decision makers the ability to perform within-group transfers as well as between-group transfers to reduce poverty in particular groups or to obtain an overall poverty alleviation. Between-group transfers are implemented in order to introduce a fairness element into the indirect tax framework, allowing to test for the robustness of reducing-tax reforms, for any order of stochastic dominance. |
| Keywords: | Between-group redistribution, CD-curves, Stochastic dominance of order s, Tax reforms |
| JEL: | D63 H20 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:lacicr:0642&r=pbe |
| By: | Jacqui McManus and Neil Warren |
| Abstract: | More recently an increasing number of revenue authorities have attempted to estimate the amount of tax that is legally owing to their government but not collected. This amount is commonly referred to as ‘tax gap’. In the past tax gap studies were branded unreliable. Tax administrations and other bodies criticised any attempts at quantifying tax non-compliance on the basis that it was costly and inconclusive. However based on the significant number of tax gap studies undertaken recently there appears to have been a change of heart. This paper considers a range of tax gap studies for the purpose of identifying the core reasons they were undertaken, highlighting their benefits and limitations. |
| Keywords: | tax gap, hidden economy, tax administration, tax, non-compliance |
| Date: | 2006–10–17 |
| URL: | http://d.repec.org/n?u=RePEc:nsw:discus:413&r=pbe |
| By: | James Sefton; Justin van de Ven; Martin Weale |
| Abstract: | Means testing plays an important role in the UK state pension system. We use a dynamic programming model to consider the long-term behavioural effects of a recent policy reform that reduced the marginal tax rates on private income of means tested retirement benefits from 100% to 40%. Our analysis suggests that the policy reform will encourage the poorest third of all households (based on wealth at age 65) to both save more and delay retirement, and have the opposite effects on richer households. In aggregate, the off-setting behavioural responses that we identify imply an overall delay in the timing of retirement, a fall in average savings, and a small effect on the government budget. We find that, on balance, the policy reform provides a reasonable compromise between the distortions associated with high marginal tax rates, and the costs implied by universal benefits provision. |
| Date: | 2006–07 |
| URL: | http://d.repec.org/n?u=RePEc:nsr:niesrd:283&r=pbe |
| By: | FLEURBAEY, Marc; SPRUMONT, Yves |
| Abstract: | We study the construction of a social ordering function for the case of a public good financed by contributions from the population, and we extend the analysis of Maniquet and Sprumont (2004) to the case when contributions cannot be negative, i.e. agents cannot receive subsidies from others. |
| Keywords: | social ordering, blic good, maximin |
| JEL: | D63 D71 H41 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:mtl:montde:2006-11&r=pbe |
| By: | Cremer, Helmuth; De Donder, Philippe; Maldonado, Darío; Pestieau, Pierre |
| Abstract: | This paper studies the determination through majority voting of a pension scheme when society consists of far-sighted and myopic individuals. All individuals have the same basic preferences but myopics tend to adopt a short term view (instant gratification) when dealing with retirement saving. Consequently, they will find themselves with low consumption after retirement and regret their insufficient savings decisions. Henceforth, when voting they tend to commit themselves into forced saving. We consider a pension scheme that is characterized by two parameters: the payroll tax rate (that determines the size or generosity of the system) and the 'Bismarckian factor' that determines its redistributiveness. Individuals vote sequentially. We examine how the introduction of myopic agents affects the generosity and the redistributiveness of the pension system. Our main result is that a flat pension system is always chosen when all individuals are of one kind (all far-sighted or all myopic), while a less redistributive system may be chosen if society is composed of both myopic and far-sighted agents. Furthermore, while myopic individuals tend to prefer larger payroll taxes than their far-sighted counterparts, the generosity of the system does not always increase with the proportion of myopics. |
| Keywords: | dual-self model; myopia; social security |
| JEL: | D91 H55 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5923&r=pbe |
| By: | Ewen McCann and Tim Edgar |
| Abstract: | A country’s net flow of capital consists of simultaneously occurring imports and exports. Because a tax on the income from capital imports affects the quantity of capital exports and vice versa, tax policies toward inbound and outbound capital should be jointly formulated in order to avoid distorting these bi-directional flows and the local capital market more generally. For a small open economy, distortion-free local capital markets are shown to require, in the limited case of portfolio debt flows: (1) the taxation of income from capital imports by the importing country at the same rate as income of residents from locally invested capital; and (2) the exemption from net tax (that is, after any foreign tax credit) in the home country of the income of its residents from capital exports. |
| Keywords: | tax, capital flow, tax policy, capital market, efficiency |
| Date: | 2006–10–17 |
| URL: | http://d.repec.org/n?u=RePEc:nsw:discus:411&r=pbe |
| By: | Anne-Marie Brook; Edward Whitehouse |
| Abstract: | Recent social security reform has significantly improved the long-run sustainability of the pension system. However, the pension system continues to serve as an important barrier to a more rapid expansion of the formalsector economy in two ways. First, early-retirement incentives (including severance payments) continue to push many incumbent formal sector workers into the informal sector, often at ages as young as 40-45. While new labour force entrants face a much higher retirement age, policies for incumbents are fiscally expensive, inequitable, and serve to swell the ranks of the informal sector. Second, even when the transition to the new pension rules is complete, net replacement rates will remain very high by OECD standards, requiring high social security contribution rates that make it too expensive for firms to employ low-skilled labour in the formal sector. Thus, further pension reform is one of the keys to overcoming Turkey's economic duality. Finally, since the pension system does not cover the informal sector, it does little to alleviate poverty among the wider population of older people. This paper discusses a number of reforms that would increase the retirement age, reduce inter-generational inequities, and permit a significant cut in the tax wedge on labour, while better addressing old-age poverty concerns at all levels of income. This Working Paper relates to the 2006 Economic Survey of Turkey (www.oecd.org/eco/surveys/turkey). <P>Le système des retraites en Turquie : Les réformes supplémentaires pour aider à résoudre le problème de l'informalité <BR>La récente réforme de la sécurité sociale a amélioré largement la viabilité à long terme du système de retraite. Cependant, la structure de ce dernier reste un important obstacle à une expansion plus rapide de l'économie formelle, pour deux raisons. Premièrement, du fait des incitations à une retraite anticipée (telles que les indemnités de départ), de nombreux travailleurs du secteur formel continuent à rejoindre le secteur informel, souvent à un jeune âge comme 40-45 ans. Alors que les nouveaux entrants dans le marché du travail prendront leur retraite à un âge bien plus élevé, les politiques concernant les travailleurs déjà actifs sont coûteuses pour les finances publiques, ne sont pas équitables et nourrissent le secteur informel. Deuxièmement, même lorsque le passage aux nouvelles règles régissant les retraites sera achevé, les taux de remplacement nets seront encore très généreux par rapport aux niveaux observés dans la zone OCDE, avec des taux de cotisation élevés qui dissuadent les entreprises du secteur formel d'employer une main-d'oeuvre peu qualifiée. En conséquence, la poursuite de la réforme des retraites est fondamentale pour surmonter ce dualisme économique. Enfin, parce qu'il ne couvre pas le secteur informel, le système de retraite ne contribue guère à atténuer la pauvreté au sein de la population âgée. Ce chapitre examine plusieurs réformes qui repousseraient l'âge de la retraite, réduiraient les inégalités intergénérationnelles et feraient diminuer significativement le coin fiscal sur le travail, tout en répondant mieux aux préoccupations suscitées par la pauvreté des personnes âgées à tous les niveaux de revenu. Ce Document de travail se rapporte à l’Étude économique de la Turquie 2006 (www.oecd.org/eco/etudes/turquie). |
| Keywords: | pensions, système de retraite, Turkey, Turquie, early retirement, retraite anticipée |
| JEL: | D10 H55 J14 J18 |
| Date: | 2006–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:529-en&r=pbe |
| By: | Schmitz, Patrick W.; Tröger, Thomas |
| Abstract: | Majority rules are frequently used to decide whether or not a public good should be provided, but will typically fail to achieve an efficient provision. We provide a worst-case analysis of the majority rule with an optimally chosen majority threshold, assuming that voters have independent private valuations and are ex-ante symmetric (provision cost shares are included in the valuations). We show that if the population is large it can happen that the optimal majority rule is essentially no better than a random provision of the public good. But the optimal majority rule is worst-case asymptotically efficient in the large-population limit if (i) the voters' expected valuation is bounded away from 0, and (ii) an absolute bound for valuations is known. |
| Keywords: | majority rule; public goods |
| JEL: | D72 D82 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5958&r=pbe |
| By: | Desmet, Klaus; Le Breton, Michel; Ortuño-Ortín, Ignacio; Weber, Shlomo |
| Abstract: | This paper presents a model of nation formation in which culturally heterogeneous agents vote on the optimal level of public spending. Larger nations benefit from increasing returns in the provision of public goods, but bear the costs of greater cultural heterogeneity. This tradeoff induces agents' preferences over different geographical configurations, thus determining the likelihood of secession and unification. We provide empirical support for choosing genetic distances as a proxy of cultural heterogeneity. By using data on genetic distances, we examine the stability of the current map of Europe and identify the regions prone to secession and the countries that are more likely to merge. Our framework is further applied to estimate the welfare gains from European Union membership. |
| Keywords: | cultural heterogeneity; European Union; genetic diversity; nation formation; secession; unification |
| JEL: | D70 F02 H40 H77 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5918&r=pbe |
| By: | Ondřej Schneider (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic) |
| Abstract: | In this paper, we combine macro and microeconomic approaches to a pension reform. First, we modify an OLG model and estimate macroeconomic effects of a pension systém switch from a pure PAYG to a mixed system. Second, we employ macroeconomic results in a microeconomic simulation in which we estimate individual welfare gains for various income groups in each cohort affected by the pension reform. We propose an unorthodox sequencing of the pension reform in which the pre-retirement generations would enter the reformed system first. This sequencing maintains the Pareto efficiency condition for all age cohorts, but it gives governments more flexibility in the reform process. |
| Keywords: | pension systems; pay-as-you-go; pension reform; funded pillar |
| JEL: | C68 E17 H55 |
| Date: | 2006–01 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2006_02&r=pbe |
| By: | Peter Haan (DIW Berlin and Free University Berlin); Viktor Steiner (DIW Berlin, Free University Berlin and IZA Bonn) |
| Abstract: | We evaluate three policy reforms targeted at older unemployed people: (i) an hourly wage subsidy, (ii) an in-work credit, and (iii) a subsidy of social security contributions on low wages. The work incentive, labour supply and welfare effects of these hypothetical reforms are analysed on the basis a detailed micro-simulation model for Germany which includes a structural household labour supply model. We find that the simulated labour supply effects of the three policy reforms would be rather similar and of moderate size, ranging between 20,000 and 30,000 older women and between 10,000 and 20,000 older men. Our results also suggest that the hourly wage subsidy yields the highest welfare gains. |
| Keywords: | in-work support, wage subsidies, unemployment, elderly workers |
| JEL: | J21 J48 H21 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2424&r=pbe |
| By: | Mark Huggett; Juan Carlos Parra (Department of Economics, Georgetown University) |
| Abstract: | This paper answers the question posed in the title within a model where agents receive idiosyncratic, wage-rate shocks that are privately observed. When the model social insurance system is comprised by the US social security and income tax system, then the maximum ex-ante welfare gain to improved insurance is equivalent to a 12.3 percent increase in consumption. We determine the reasons behind this large welfare gain. We also analyze two parametric reforms of the model social insurance system. One reform increases welfare very little, whereas the other achieves nearly all of the maximum possible welfare gain. Classification-JEL Codes: D80, D90, E21 |
| Keywords: | Social Insurance, Social Security, Idiosyncratic Shocks, Private Information |
| URL: | http://d.repec.org/n?u=RePEc:geo:guwopa:gueconwpa~06-06-11&r=pbe |
| By: | SPRUMONT, Yves; MANIQUET, François |
| Abstract: | We study the problem of provision and cost-sharing of a public good in large economies where exclusion, complete or partial, is possible. We search for incentive-constrained efficient allocation rules that display fairness properties. Population monotonicity says that an increase in population should not be detrimental to anyone. Demand monotonicity states that an increase in the demand for the public good (in the sense of a first-order stochastic dominance shift in the distribution of preferences) should not be detrimental to any agent whose preferences remain unchanged. Under suitable domain restrictions, there exists a unique incentive-constrained efficient and demand-monotonic allocation rule: the so-called serial rule. In the binary public good case, the serial rule is also the only incentive-constrained efficient and population-monotonic rule. |
| Keywords: | excludable blic good, incentive comtibility, fairness, serial rule |
| JEL: | D63 D71 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:mtl:montde:2006-09&r=pbe |
| By: | Jan Zápal (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic; London School of Economics and Political Science) |
| Abstract: | This paper deals with the growth accounting method used for derivation of so called net fiscal effort. Net fiscal effort can then provide a clue whether fiscal policy is expansionary or not and together with the data about economic performance can answer the question of pro- or anti-cyclicality of fiscal stance. Traditionally, answer to such questions has been provided via cyclically adjusted budget balance measure. I argue that relatively computational intensive and data demanding process of estimation of cyclically adjusted budget balance can be without significant loss of information replaced by simple growth accounting method. I argue that in general case, answers provided via growth accounting method will not differ widely from the conclusions provided via cyclically adjusted budget balance. I then illustrate on Czech fiscal data use of growth accounting and compare the outcomes of both methods. Conclusions reached in the empirical part fit nicely conclusions of the theoretical part of the paper. |
| Keywords: | Expansionary/Contractionary Fiscal Policy; Cyclically Adjusted Budget Balance; Growth Accounting; Net Fiscal Effort |
| JEL: | C82 H62 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2006_05&r=pbe |
| By: | David Martimort; Stephane Straub |
| Abstract: | This paper offers a theory of how the degree of corruption that prevails in a society responds to changes in the ownership structure of major public service providers. We show that there are cases in which privatization, even though it fosters investments in infrastructure, also opens the door to more corruption. The public dissatisfaction towards privatization is then crucially affected by the changes in the degree and pattern of corruption. Our model thus helps understand the seemingly paradoxical situation prevailing in Latin America, where most studies find that privatizations have been efficiency-enhancing and have fostered investments and, at the same time, popular dissatisfaction with the process is extremely high, especially among the middle class. We show that this line of explanation is supported by evidence from surveys in the region. |
| URL: | http://d.repec.org/n?u=RePEc:edn:esedps:147&r=pbe |
| By: | Bovenberg, A Lans; Uhlig, Harald |
| Abstract: | This paper explores the optimal risk sharing arrangement between generations in an overlapping generations model with endogenous growth. We allow for nonseparable preferences, paying particular attention to the risk aversion of the old as well as overall 'life-cycle' risk aversion. We provide a fairly tractable model, which can serve as a starting point to explore these issues in models with a larger number of periods of life, and show how it can be solved. We provide a general risk sharing condition, and discuss its implications. We explore the properties of the model quantitatively. Among the key findings are the following. First and for reasonable parameters, the old typically bear a larger burden of the risk in productivity surprises, if old-age risk-aversion is smaller than life risk aversion, and vice versa. Thus, it is not necessarily the case that the young ensure smooth consumption of the old. Second, consumption of the young and the old always move in the same direction, even for population growth shocks. This result is in contrast to the result of a fully-funded decentralized system without risk-sharing between generations. Third, persistent increases in longevity will lead to lower total consumption of the old (and thus certainly lower per-period consumption of the old) as well as the young as well as higher work effort of the young. The additional resources are instead used to increase growth and future output, resulting in higher consumption of future generations. |
| Keywords: | overlapping generations; pension systems; risk sharing; social optimum |
| JEL: | E21 E61 E62 H21 H55 O40 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5949&r=pbe |
| By: | Spilimbergo, Antonio |
| Abstract: | Do foreign educated individuals play a role in promoting democracy in their home country? Despite the large amount of private and public resources spent on foreign education, there is no systematic evidence that foreign educated individuals foster democracy in their home countries. Using a unique panel dataset on foreign students starting from 1950, I show that indeed foreign-educated individuals promote democracy in their home country, but only if the foreign education is acquired in democratic countries. The results are robust to reverse causality, country-specific omitted variables, and inclusion of a variety of control variables. The results are stronger for small countries. |
| Keywords: | democracy; development; education; institutions; international students |
| JEL: | D72 D74 H11 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5934&r=pbe |
| By: | Domeij, David; Ljungqvist, Lars |
| Abstract: | Swedish census data and tax records reveal an astonishing wage compression; the Swedish skill premium fell by more than 30 percent between 1970 and 1990 while the U.S. skill premium, after an initial decline in the 1970s, rose by 8-10 percent. Since then both skill premia have increased by around 10 percentage points in 2002. Theories that equalize wages with marginal products can rationalize these disparate outcomes when we replace commonly used measures of total labour supplies by private sector employment. Our analysis suggests that the dramatic decline of the skill premium in Sweden is the result of an expanding public sector that today comprises roughly one third of the labor force, and that expansion has largely taken the form of drawing low-skilled workers into local government jobs that service the welfare state. |
| Keywords: | employment; private sector; public sector; skill premium; Sweden; United States |
| JEL: | E24 J31 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5921&r=pbe |
| By: | Pastine, Ivan; Pastine, Tuvana |
| Abstract: | This paper extends Che and Gale (1998) by allowing the incumbent politician to have a preference for the policy position of one of the lobbyists. The effect of a contribution cap is analyzed where two lobbyists contest for a political prize. The cap always helps the lobbyist whose policy position is preferred by the politician no matter whether it is the high-valuation or the low-valuation contestant. In contrast to Che and Gale, once the cap is binding a more restrictive cap always reduces expected aggregate contributions. However, the politician might support the legislation of a barely binding cap. When politician policy preferences perfectly reflect the will of the people, a more restrictive cap is always welfare increasing. When lobbyist's valuations completely internalize all social costs and benefits, a cap is welfare improving if and only if the politician favors the high-value policy. Even a barely binding cap can have significant welfare consequences. |
| Keywords: | all-pay auction; campaign finance reform; explicit ceiling |
| JEL: | C72 D72 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5913&r=pbe |
| By: | Paul Makdissi |
| Abstract: | This paper analyzes the definition of economic efficiency. The standard definition used in economic literature is the Pareto Optimum which is based in the space of individual utilities. This paper proposes new definitions based on alternative spaces. The paper also introduces a dominance criterion for efficiency over a set of social evaluation spaces. |
| Keywords: | Efficiency, Social justice, Dominance |
| JEL: | D60 H20 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:lacicr:0644&r=pbe |
| By: | Daniela Del Boca (University of Turin, CHILD and IZA Bonn); Marilena Locatelli (University of Turin, CHILD) |
| Abstract: | In this paper we present important empirical evidence regarding recent trends in women’s participation and fertility in European countries, and provide several interpretations of the differences across countries. Several recent analyses have considered labour supply and fertility as a joint decision and have explicitly taken into account the endogeneity of fertility in labour market participation decisions of women. We survey microeconomic analyses that explore the impact of social policies on the joint decisions of labor market participation and fertility. The results of most analyses indicate that social policies, taking into account several variables (family background, the allocation of time within the household, religion and culture), have a very relevant role in explaining different degrees of incompatibility between employment and child rearing across different countries. The incompatibilities between motherhood and careers find reconciliation in policies that enhance employment flexibility and diminish the potential opportunity costs of children. |
| Keywords: | labor market decisions, fertility, child care, family policies |
| JEL: | J2 C3 D1 H31 |
| Date: | 2006–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2414&r=pbe |
| By: | A. Affuso |
| Abstract: | This paper investigates the effect of real assets as collateral on the economy. I show how credit rationing is mitigated by the exsistence of bad firms whether it is linked to the value of distressed assets. Indeed, when loans are collateralized and firms are credit constrained, the amount borrowed is determined by the value of the collateral. The model builds on Stiglitz and Weiss (1981) and Shleifer and Vishny (1992) to show that there exists a link between firms’ debt capacities and asset values in case of distress and the classical credit rationing model. Such as in the paper of Shleifer and Vishny, I endogenize the assets price. The price depends on whether there are firms that repurchase the assets. In fact, it depends on the number of bad firms in the economy as well as on the liquidity of good firms. I show that is possible to have a separating equilibrium only if there exists a number of bad firms that go bankrupt and if there exist good firms with sufficient liquidity. Each firm derives positive externalities from the existence of other firms. Indeed, the optimal leverage of firms depends on the possibility of repurchasing the assets. In this model the financial intermediaries play a role because they arise as internal markets for assets. |
| Keywords: | Adverse selection, credit rationing, real assets, asymmetric information, public subsidies |
| JEL: | D82 H23 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:par:dipeco:2006-ep04&r=pbe |
| By: | AMBEC, Steve; EHLERS, Lars |
| Abstract: | With diminishing global water reserves the problem of water allocation becomes increasingly important. We consider the problem of efficiently sharing a river among a group of satiable countries. Inducing countries to efficiently cooperate requires monetary compensations via international agreements. We show that cooperation of the other countries exerts a positive externality on the benefit of a coalition. Our problem is to distribute the benefit of efficiently sharing the river under these constraints. If the countries outside of a coalition do not cooperate at all, then the downstream incremental distribution is the unique compromise between the absolute territorial sovereignty (ATS) doctrine and the unlimited territorial integrity (UTI) doctrine. If all countries outside of a coalition cooperate, then there may not exist any distribution satisfying the UTI doctrine. |
| Keywords: | Water Allocation, Externalities |
| JEL: | C71 D62 H23 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:mtl:montde:2006-10&r=pbe |
| By: | Pavoni, Nicola; Violante, Giovanni L |
| Abstract: | A Welfare-to-Work (WTW) program is a mix of government expenditures on various labor market policies targeted to the unemployed (e.g., unemployment insurance, job search monitoring, social assistance, wage subsidies). This paper provides a dynamic principal-agent framework suitable for analyzing chief features of an optimal WTW program such as the sequence and duration of the different policies, the dynamic pattern of payments along the unemployment spell, and the emergence of taxes/subsidies upon re-employment. The optimal program endogenously generates an absorbing policy of last resort ('social assistance') characterized by a constant lifetime payment and no active participation by the agent. Human capital depreciation is a necessary condition for policy transitions to be part of an optimal WTW program. The typical sequence of policies is quite simple: the program starts with standard unemployment insurance, then switches into monitored search and, finally, into social assistance. The optimal benefits are decreasing during unemployment insurance and constant during both job search monitoring and social assistance. Whereas taxes (subsidies) can be either increasing or decreasing with duration during unemployment insurance, they must decrease (increase) during a phase of job search monitoring. In a calibration exercise, we use our model to analyze quantitatively the features of the optimal program for the U.S. economy. With respect to the existing U.S. system, the optimal WTW scheme delivers sizeable welfare gains to unskilled workers because the incentives to search for a job can be retained even while delivering more insurance, and using costly monitoring less intensively. |
| Keywords: | human capital; job search monitoring; recursive contracts; unemployment insurance; welfare-to-work |
| JEL: | D82 H21 J24 J64 J65 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5937&r=pbe |
| By: | G. Geroldi; M. Ziliotti |
| Abstract: | A partire dalle novità normative introdotte dalla Legge Finanziaria 2002, si è registrata nel nostro Paese un’accelerazione dei processi di privatizzazione dei servizi pubblici locali (SPL), con più o meno radicali mutamenti nei modelli di governance e negli assetti proprietari delle aziende erogatrici. Si è infatti proceduto ad una quasi integrale 'societarizzazione' dei soggetti titolari delle gestioni ed, in alcuni casi, si è proseguito, assegnando ai privati partecipazioni minoritarie, per giungere – talvolta – alla quotazione in borsa. Come è noto, la teoria economica, a partire dal “teorema fondamentale” di Sappington e Stiglitz, ha analizzato la desiderabilità della privatizzazione, in termini di miglioramento del benessere sociale attraverso una configurazione industriale più efficiente (x-efficienza à la Leibenstein-Gravelle ed efficienza allocativa). Tuttavia, se da un lato la letteratura attribuisce tipicamente al termine privatizzazione il significato di cessione ai privati del controllo di un’azienda precedentemente in mano pubblica (privatizzazione sostanziale), dall’altro, nella realtà, si riscontrano molto di frequente fenomeni di privatizzazione solo “formale”. L’indagine svolta nel presente lavoro analizza il caso Enìa S.p.A., nata per la gestione dei SPL nelle province di Reggio Emilia, Parma e Piacenza, come un caso di adozione di una forma giuridica di carattere privatistico (trasformazione in S.p.A.) in luogo di una di stampo pubblicistico, senza che da questo mutamento, allo stato, sia disceso un passaggio del controllo da un soggetto pubblico ad uno privato. A tali fini, si è utilizzato un recente modello proposto da Weigel , basato su una analisi matriciale delle attività svolte, per settori di operatività (energia elettrica, gas, ambiente) e per fasi produttive (produzione vera e propria, erogazione, distribuzione), che è in grado di focalizzare taluni aspetti rilevanti nella complessità delle scelte operate dagli enti pubblici interessati, generata dalla necessità di sceglierein un insieme multidimensionale di opzioni, riguardante tutti gli elementi della matrice stessa. La conclusione a cui si è pervenuti evidenzia non solo l’attuale esclusione dei privati dalla partecipazione in Enìa, ma anche gli scarsi livelli di liberalizzazione (intesa come apertura alla concorrenza) che interessano in particolare i settori “non energy”. L’indagine svolta offre lo spunto per verificare le prospettive di futura evoluzione dell’assetto proprietario e di governance, non solo di Enìa S.p.A, ma in generale delle Multiutilities locali italiane. In tal senso, l’analisi del caso della società di servizi Enìa S.p.A. appare emblematica, sia rispetto alla evidenziazione di alcuni dei limiti più rilevanti del processo di privatizzazione avviato nel settore dei SPL dopo la finanziaria 2002, sia offrendo alcuni spunti circa le differenti direzioni e le procedure volte a sfruttare economie di scala e scopo (quotazione in mercati regolamentati e/o integrazione con altre Multiutilities). |
| Keywords: | Privatization, utilities, regulation |
| JEL: | H42 L51 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:par:dipeco:2006-ep06&r=pbe |
| By: | Kate Bayliss |
| Abstract: | This paper is concerned with the micro-level effects of privatisation in South-East Europe, focusing on the experiences of Bosnia Herzegovina and the Republic of Serbia. The republics of the former Yugoslavia were among the first transition economies in Eastern Europe to implement privatisation as far back as 1989, based on the sale of shares to ‘insiders’. However, little was achieved until after the devastating war of the early 1990s, which resulted in both Bosnia Herzegovina and the Republic of Serbia approaching the introduction of revised privatisation programmes in the latter part of the decade from a much weaker economic base. The paper explores the relationship between different privatisation methods and policy outcomes based on a sample of medium-scale industrial enterprises in the two countries for alternative categories of investor. It also considers the effect on the enterprises surveyed of the years of conflict and the break-up of the former Yugoslavia. While there is much shared history, Bosnia Herzegovina and Serbia have had different experiences with privatisation, and the analysis presented in this paper indicates that it is not possible to point to a post-conflict privatisation effect. Rather, outcomes depend on a number of factors including the nature of the programme adopted, the post-war political and institutional framework, the capacity and credibility of the privatisation programme and the wider economic climate. |
| Keywords: | Privatisation, Serbia, Bosnia Herzegovina, transition economies |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:odi:wpaper:12&r=pbe |