“Causes of the Transformation of the US Fiscal System in the 1930s,” VoxEU, 2016

Summary:
VoxEU, October 11, 2016, with Martin Gonzalez-Eiras. HTML. The US fiscal system underwent a radical transformation around the time of the Great Depression. Perceived cost differences of revenue collection across levels of government, due to general equilibrium effects, can partly explain the rise of tax centralization and intergovernmental grants. We develop a micro-founded general equilibrium model that blends politics and macroeconomics. (See the working paper.)

Topics:
Dirk Niepelt considers the following as important: Contributions, Decentralization, Federal government, Fiscal federalism, General equilibrium, Grant, Income tax, Inter governmental grant, Politics, Tax, Tax collection cost

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