Too-big-to-fail in federations?

IF 3.5 2区经济学 Q1 ECONOMICS

Regional Science and Urban Economics Pub Date : 2023-07-01 DOI:10.1016/j.regsciurbeco.2023.103917

Zarko Kalamov , Klaas Staal

引用次数: 0

Abstract

We consider jurisdictions of different population size that provide local public goods with positive spillovers. Matching grants can induce optimal expenditure levels, but the regions can exploit the rationale behind this system to induce bailouts. We formalize the too-big-to-fail result of Wildasin (1997) by proving that it exists in a subgame-perfect Nash equilibrium, in which the central government’s decisions are taken by regional representatives. Furthermore, our model contains the too-big-to-fail and too-small-to-fail outcomes as special cases, and we are the first to derive the conditions under which each result emerges.

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联邦政府大到不能倒?

我们考虑不同人口规模的司法管辖区，这些司法管辖区为当地公共产品提供了积极的溢出效应。匹配补助金可以诱导最佳支出水平，但各地区可以利用这一制度背后的理由来诱导救助。我们通过证明Wildasin（1997）的“大到不能倒”结果存在于子博弈完美纳什均衡中，在该均衡中，中央政府的决策由地区代表做出。此外，我们的模型包含了太大而不能失败和太小而不能失败的结果作为特殊情况，我们是第一个推导出每个结果出现的条件的人。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Regional Science and Urban Economics Multiple-

CiteScore

5.30

自引率

9.70%

发文量

期刊介绍： Regional Science and Urban Economics facilitates and encourages high-quality scholarship on important issues in regional and urban economics. It publishes significant contributions that are theoretical or empirical, positive or normative. It solicits original papers with a spatial dimension that can be of interest to economists. Empirical papers studying causal mechanisms are expected to propose a convincing identification strategy.