the determinants of homeownership affordability among the sandwich class empirical findings from guangzhou china the sandwich class is an east asian term referring to the lower middle class using a large and unique micro dataset collected in guangzhou this paper examines empirically the potential determin

efficiency and equalization payments in a federal system of government a synthesis and extensions of recent results this paper investigates the rationale for a system of equalization transfers in a federal system of government the existing sources of inefficiency of resource allocation in economies with more than one level of government are synthesized in the framework of a simple decentralized multiprovince model with mobile factors of production the sources of inefficiency arise first because migrants respond at the margin to incorrect signals owing to the phenomena of rent sharing and fiscal exterality and second because of global rather than local inefficiencies the model is then extended to consider the role of the federal government in providing intergovernmental transfers in the face of such inefficiencies in addition to synthesizing the sources of inefficiency in federal models the equity arguments for equalization are briefly recounted efficacite et paiements de perequation dans un systeme federal de gouvernement synthese et extensions de certains resultats recents ce memoire examine la logique qui soustend un systeme de paiements de perequation dans un systeme fdderal de gouverement les auteurs utilisent un modele simple d un systeme multi provincial decentralise avec des facteurs de production mobiles pour definir les sources d inefficacite dans l allocation des ressources dans les dconomies qui possedent plus d un niveau de gouvernement ces inefficacites proviennent de ce que d abord ceux qui se deplacent le font en reponse a la marge a des signaux incorrects engendres par le partage de la rente sur la base de la residence et par les phenomenes d exteralites fiscales elles sont aussi le resultat d inefficacites globales plutot que locales dans le cadre de ce modele les auteurs analysent le role du gouvernement federal effectuant des transferts inter gouverementaux pour corriger ces inefficacites en plus de presenter une synthese des sources d inefficacite dans les regimes federaux les auteurs font un bref rappel en passant a l ensemble des arguments fondes sur l equite qu on utilise pour rationaliser les paiements de perequation this paper is a linear combination of two papers presented at the may 1982 meetings of the canadian economics association in halifax entitled the case for equalization payments by the authors and recent developments in the theory of regional economic policy in canada by boadway the authors are grateful for comments by the discussants jim johnson and baxter macdonald and by jack mintz brian scarfe gerard belanger david sewell tom courchene and the referees we are especially heavily indebted to dan usher for many stimulating comments and suggestions while the work was in progress some of the above persons will undoubtedly disagree with the emphasis we have chosen to put on various aspects of the analysis for policy purposes support for some of this work has been provided by the economic council of canada and is gratefully acknowledged canadian journal of economics revue canadienne d economique xv no 4 november novembre 1982 printed in canada imprimd au canada 0008 4085 82 0000 0613 01 50 1982 canadian economics association this content downloaded from 207 46 13 127 on wed 12 oct 2016 04 27 47 utc all use subject to http about jstor org terms 614 robin boadway and frank flatters

income redistribution in a common labor market when households are mobile among jurisdictions income redistribution by individual jurisdictions creates fiscal externalities a model of interjurisdictional migration is used to study the nature of this redistributive externality analysis of optimal redistribution and optimal corrective subsidies from higher level governments shows that benefit levels for the recipients of income transfers and tax rates on mobile taxpayers should be equalized across jurisdictions a system of jurisdictions with a common labor market can achieve welfare improvements through coordination of domestic redistributive policy or through the intervention of a higher level government copyright 1991 by american economic association

primary energy demand in japan an empirical analysis of long term trends and future co2 emissions abstract this paper examines the long run relationship between energy demand gnp and the real energy price in japan using data covering 1887 2001 it is found that if an underlying energy demand trend is appropriately incorporated the resulting econometric model produces a long run income elasticity of about unity and a long run price elasticity of about 0 2 the estimated model is utilised to forecast energy consumption and co 2 emissions up to 2012 it is shown that given current economic conditions and policies there is considerable uncertainty about whether japan will be able to meet its kyoto target by reducing co 2 emissions in 2008 2012 to the 1990 level it is shown that this uncertainty depends on the strength of the economy and leaves the japanese government with a difficult policy dilemma if there is a resurgence in growth to something near the annual average growth rate since the early 1980s a considerable effort will be required in order to meet its kyoto target requiring not only using the kyoto mechanisms but also additional tougher domestic policies and measures such as emissions capping r d incentives and education for energy conservation in addition to a pricing and tax policy

how reliable are simple single equation specifications of import demand this paper examines nine models of aggregate import demand for each of five countries canada germany japan united kingdom and united states in an attempt to determine which of the frequently used single equation models of import demand are appropriate an appropriate model is defined as one which generates unbiased or at least consistent and efficient elasticity estimates while models without lagged adjustments and almon lag models perform rather poorly according to these criteria models including dynamic behavior through lagged values of the dependent variable are frequently accepted results are reported regarding functional form measures of variables and structural shift economists have devoted considerable attention to the estimation of aggregate import demand elasticities because of their importance in trade theory the simplest procedure for estimating these elasticities which is consistent with economic theory is to assume that the elasticity of supply of imports is infinitely elastic and to estimate

the role of intergovernmental aid in defining fiscal sustainability at the sub national level the concept of fiscal sustainability has become increasingly used over the last 20 years however much of the literature on fiscal sustainability at the sub national level ignores the role of intergovernmental fiscal relations to address this gap this paper discusses a sufficient condition for sub national fiscal sustainability and examines the importance of intergovernmental aid in determining that sustainability using panel data of counties and municipalities in the us and using unit root and cointegration analytic techniques this paper finds different levels of fiscal sustainability between counties and municipalities we also find that intergovernmental aid plays an important role for fiscal sustainability for both counties and municipalities

the reliability of aggregate energy demand functions an application of statistical specification error tests abstract the paper examines the unbiasedness and efficiency of various energy elasticity estimates by means of statistical specification error tests the model selection procedure is applied to energy consumption data of eight industrialized countries it is found that models which describe dynamic behaviour by including the lagged dependent variable among the regressors are most frequently accepted and that long term income effects are important for all countries strong differences among countries prevail concerning the appropriateness of including a time trend elasticities derived from accepted models differ considerably among countries

physical and human capital and brazilian regional growth a spatial econometric approach for the period 1970 2010 carvalho r and silveira neto r physical and human capital and brazilian regional growth a spatial econometric approach for the period 1970 2010 regional studies this paper identifies the determinants of economic growth and analyses the dynamics of income using a panel of 522 brazilian micro regions for period 1970 2010 based on the spatial extension of the mankiw romer weil mrw model and explicitly considering both physical and human capital the parameters of a spatial durbin model sdm with fixed effects are estimated the direct and indirect impacts of the determinants of regional growth are then calculated the results indicate strong spatial dependence among brazilian micro regions and that investments in both physical and human capital are important for the growth of the brazilian regional economies

ex post redistribution in a federation implications for corrective policy abstract this paper analyzes whether changes in the timing of equalizing transfers to state governments necessitate an adjustment in federal corrective policy according to the existing literature assuming an ex ante choice of transfers the corrective grant is equal to the marginal damage benefit inflicted by externality generation when the federal government accommodates state finances ex post the grant differs in formula from existing prescription allocative federal policy corrects state policy incentives twofold it entails a correction for the distortion in the marginal benefit of state spending as in earlier literature and for the distortion in the marginal cost of public funds induced by the ex post provision of transfers the required grant rule is generically disproportionate to the equilibrium externality even with lump sum taxation furthermore the ex post provision of transfers is critical for the nature of the equilibrium inefficiency equalizing transfers at least partly internalize consumption spill overs but simultaneously establishes a new source of inefficiency as a final result the existing prescription for allocative federal policy continues to apply if the public good is pure

short and long run elasticities in energy demand a cointegration approach abstract short and long run energy demand elasticities are estimated on danish annual data for 1948 1990 energy consumption the real price of energy and real gdp appear to be non stationary variables cointegration and error correction methods are therefore applied all estimated parameters have the expected signs and magnitudes and no evidence is found of a structural break in energy demand caused by the increases in real energy prices since 1973 74

incentive equivalence with fixed migration costs abstract if migration between communities is costless and if policy makers in each community anticipate the migration response to policy changes then the interests of the two communities are perfectly aligned decentralization is efficient this incentive equivalence is well known however the first order approach used in virtually all the literature may obscure the fact that no convexity assumptions need be made about technology or tastes this fact underscores the relevance of incentive equivalence even when there are scale economies in the public sector here the consequences of positive migration costs for this incentive equivalence are considered in contrast with much of the literature migration costs are assumed the same for everyone this formulation differs from the more common attachment to home assumption of heterogeneous migration costs conditional on the direction of migration interests of different communities are still perfectly aligned but natives of different communities may prefer different directions of migration weakening incentive equivalence if local policy makers have the power to induce large changes in migration flows however incentive equivalence fails only if economies of scale in population are important so that communities may be under populated

the importance of engaging residential energy customers hearts and minds abstract in an attempt to reduce the contribution of residential greenhouse gas emissions the eu has implemented a variety of policy measures the focus has been to promote domestic energy efficiency and ultimately a reduction in residential energy demand in this study we estimate residential energy demand using underlying energy demand trend uedt and asymmetric price responses for 14 european oecd countries between 1978 and 2008 our results support the conclusion that policies to reduce residential energy consumption and the consequent emissions need to account for behavioural lifestyle and cultural factors in order to be effective

transboundary pollution and household mobility are they equivalent abstract recent research has shown that perfect household mobility can serve as a disciplinary mechanism inducing national policy makers to internalize interregional externalities caused by transboundary pollution this paper develops a differential game to illustrate that the result is not necessarily robust when migration costs and explicit dynamics are introduced the paper shows that if governments constantly reoptimize imperfect household mobility leads to a tragedy of the commons and individual countries overemit even when pollution is purely local moreover these dynamic externalities get worse as the degree of household mobility increases and there is a qualitative difference between almost perfect and perfect mobilty that is a discontinuity at zero migration costs

inter regional transfers and the induced under taxation of economic rents abstractinter regional transfers and the induced under taxation of economic rents regional studies this paper shows that if taxes on economic rent are assigned to anticipatory first moving regions and inter regional transfers are mandated centrally rents are under taxed relative to optimal levels this provides a possible explanation for low rent capture observed in australia and canada two resource rich federal economies that also have fiscal equalization transfers between regions

the rise of the states u s fiscal decentralization in the postwar period article i nfo article history one of the most dramatic changes in the fiscal federalism landscape during the postwar period has been the rapid growth in state budgets which almost tripled as a share of gdp and doubled as a share of government spending between 1952 and 2006 we argue that the greater role of states cannot be easily explained by changes in tiebout forces of fiscal competition such as mobility and voting patterns and are not accounted for by demographic or income trends rather we demonstrate that much of the growth in state budgets has been driven by changes in intergovernmental interactions restricted federal grants to states have increased and federal policy and legal constraints have also mandated or heavily incentivized state own source spending particularly in the areas of education health and public welfare these outside pressures moderate the forces of fiscal competition and must be taken into account when assessing the implications of observed revenue and spending patterns

functional form and aggregate energy demand elasticities a nonparametric panel approach for 17 oecd countries this paper studies whether the commonly used linear parametric model for estimating aggregate energy demand is the correct functional specification for the data generating process parametric and n

residential investment and the current account abstract residential investment is an important driving force in the current account this paper first builds the model to show that residential investment for the empirically relevant case where demand for housing services has nonzero income elasticity is fundamentally different from nonresidential investment owing to this income effect the dynamics of housing are subject to the additional integral constraint as well as the standard stock adjustment and euler equations the model is used to examine the effects of changes in government purchases on the tradeable good housing subsidies and productivity shocks on the current account

redistribution within and across the regions of a federation the authors reconsider the literature on redistribution within a federation with mobile agents they conclude that redistribution is a function best assigned to the national government local governments with diverse preferences for redistribution distort individual migration decisions the authors also examine the fiscal externality literature which has made an efficiency argument for interregional transfers they show that if local governments have the same preferences for redistribution the nash equilibrium is efficient if preferences are diverse the authors show that nationally imposed interregional transfers do not address the source of the inefficiency nevertheless interregional transfers are shown to be a part of decentralized behavior

house prices borrowing constraints and monetary policy in the business cycle i develop a general equilibrium model with sticky prices credit constraints nominal loans and asset prices changes in asset prices modify agents borrowing capacity through collateral value changes in nominal prices affect real repayments through debt deflation monetary policy shocks move asset and nominal prices in the same direction and are amplified and propagated over time the financial accelerator is not constant across shocks nominal debt stabilises supply shocks making the economy less volatile when the central bank controls the interest rate i discuss the role of equity debt indexation and household and firm leverage in the propagation mechanism finally i find that monetary policy should not target asset prices as a means of reducing output and inflation volatility

energy consumption and economic activity in industrialized economies a note abstract in industrialized countries the income elasticity of primary energy demand is not far off unity furthermore it can be argued that there is little use in distinguishing between short and long term income elasticities a long term income elasticity does not have a direct impact on energy demand and hence it is of doubtful use in energy demand projections via an aggregate oecd model it was estimated that the short term impact of prices on primary energy demand is about 0 15 while the long term impact is 0 43 but increasing over time

the housing led growth hypothesis revisited evidence from the chinese provincial panel data this paper investigates the relationship between housing investment and economic growth in china utilising province level data via recently developed panel unit root tests and panel co integration analysis the empirical results suggest a stable long run relationship between housing investment non housing investment and gdp in china in addition the existence is demonstrated of bi directional granger causality between housing investment and gdp at the national level the panel error correction model supports the hypothesis that housing investment appears to have a dual role acting as both a driver and follower in china s economic fluctuations however the impacts of housing investment on economic growth in three sub regions are found to be strikingly different

devolution grants and fiscal competition following half a century of fiscal activism and federal leadership the call now is for downsizing the federal budget and a devolution of fiscal responsibilities to states and localities the call for federalism meant to secure a stronger center in james madison s time now seeks to decentralize this paper outlines the main features of fiscal federalism as i see them sketching a vision which differs in major respects from that offered by the lead paper in this symposium first i highlight the role of distribution which i see as a central function then i focus attention on grants in aid and their role in the federal system finally i consider competition cooperation and coordination between jurisdictions

raising taxes through equalization a simple theory suggests that a common form of federal horizontal equalization grants should cause subnational governments to levy higher tax rates distorting local tax bases and so increasing federal transfers to test this i examine canadian provincial tax policies in the 1972 2002 period consistent with the theory provinces respond to expansions of equalization transfers by increasing their own tax rates i estimate that on average tax rates in grant receiving provinces were substantially and significantly higher as a consequence of the transfer formula jel classification h21 une theorie simple suggere qu une forme usuelle d octrois federaux de perequation horizontale devrait entrainer les gouvernements sub nationaux a imposer de plus hauts taux d imposition modifiant ainsi les bases de fiscalite locale et ce faisant accroissant les transferts federaux pour mettre au test cette hypothese on examine les politiques fiscales des provinces canadiennes pour la periode entre 1972 et 2002 d une maniere qui semble supporter l hypothese les provinces ont repondu a un accroissement des transferts de perequation en accroissant leur propre taux d imposition on estime que les taux moyens d imposition dans les provinces qui recoivent des transferts sont plus eleves de maniere substantielle et significative en raison de la formule de transferts

accounting for technical progress in aggregate energy demand abstract researchers have not reached a consensus on how to account for technical progress when modeling aggregate energy demand some include a time trend in a dynamic model while others omit the trend in a model that disallows for long run income effects we show that the latter approach can be directly tested as a nested case of the former so that model selection need not be made a priori solely on theoretical grounds using annual data over 1960 1990 we find that long run income effects are not significant however including a time trend improves the model s fit while rendering much more credible long run price elasticities

residential energy demand additional empirical evidence by minority household type abstract in a number of recent studies household level data for specific urban areas or national household level micro data have been used to estimate price and income elasticities of energy demand none of this literature however provides us with elasticity estimates by minority majority household type the main focus of this paper is to measure the responsiveness of the quantity of electricity and total energy demanded for black hispanis and majority households to price and income price and income elasticities are compared among these groups over the short and long term a variable elasticity demand model is estimated the elasticities are allowed to vary with respect to non price and income variables the price elasticities of demand vary with heating and cooling degree days and the income elasticities with the number of household members mean estimates were calculated over the respective samples findings indicate that demand for electricity is relatively price inelastic irrespective of household group however blacks are more sensitive to variations in the short run to price than hispanic and majority households in the long run blacks are also more sensitive to price changes but the magnitude of the response to price changes in the long run relative to the short run is larger for hispanics and majority households respectively than for blacks

underlying trends and seasonality in uk energy demand a sectoral analysis this paper demonstrates the importance for energy demand modelling of allowing for trends and seasonal effects that are stochastic in form inherent underlying trends may be non linear and reflect not only technical progress which usually produces greater energy efficiency but also other factors such as changes in consumer tastes and the economic structure that may be working in the opposite direction using quarterly unadjusted data for various sectors in the uk it is shown that unless energy demand models are formulated so as to allow for stochastic trends and seasonals estimates of price and income elasticities could be seriously biased

evaluating the efficiency and equity of federal fiscal equalization abstract theoretically federal transfers that make household location decisions efficient should ignore local cost differences subsidize positive externalities and offset differences in federal tax payments and local taxes levied on non residents but not local tax revenues from residents transfers that redistribute resources equitably across regions will likely target areas with individuals of low earnings potential or low real incomes applying these criteria empirically canadian equalization policy appears neither efficient nor equitable but exacerbates pre existing inefficiencies and underfunds minorities locational inefficiencies cost canada 0 41 of income annually and cause over funded provinces to have populations of 30 beyond their efficient long run levels

a simple dynamic decentralized leadership model with private savings and local borrowing regulation abstract this paper considers a simple dynamic decentralized leadership model with local borrowing and regional productivity enhancing investment in this model the central government is benevolent but cannot commit to ex post intergovernmental transfer policies while local governments act strategically after accounting for the ex post motives of the central government we then investigate inefficiency in the subgame perfect equilibrium we analyze the effect of central control on local borrowing and show that central control is of no benefit because ex ante local taxation works to offset it we find the model yields different policy implications that central control is effective when extended to the case of residential mobility

demand elasticities in oecd dynamical aspects abstract four models with different lag structures are used to express final energy demand in oecd from 1960 1982 as a function of real gdp and average energy price the income and long run price elasticities are not significantly dependent on the model specification but the koyck lag scheme estimated in its distributed lag form is found to give the most satisfactory results the statistical properties of the data together with evidence of trends in the elasticities both suggest that the period of falling real prices prior to 1971 is not comparable to the present period for the period after 1971 an income elsticity of 1 02 and a long run price elasticity of 0 37 are obtained

energy consumption and economic activity in industrialized countries the dynamic aggregate time series relationship abstract most econometric studies suggest that the income elasticity of demand for energy is approximately unity for the developed market economies it is shown that over the period 1950 1978 the long run income elasticity is substantially higher than unity in terms of a ces energy demand function this result reflects the application of a generalized dynamic estimation methodology where serial correlation is regarded as a diagnostic guide to distributed lag fitting price elasticities are also estimated but these are in line with conventional estimates

the relationship between energy consumption energy prices and economic growth time series evidence from asian developing countries this paper estimates the causal relationships between energy consumption and income for india indonesia the philippines and thailand using cointegration and error correction modelling techniques the results indicate that in the short run unidirectional granger causality runs from energy to income for india and indonesia while bidirectional granger causality runs from energy to income for thailand and the philippines in the case of thailand and the philippines energy income and prices are mutually causal the study results do not support the view that energy and income are neutral with respect to each other with the exception of indonesia and india where neutrality is observed in the short run c 2000 elsevier science b v all rights reserved jel classifications c22 q43 q48

tax competition rent seeking and fiscal decentralization abstract the present paper provides a basis for evaluating fiscal decentralization of expenditure and tax responsibilities by encompassing the literature on tax competition and rent seeking both tax and rent seeking competitions are conceived of as being wasteful and self defeating we find that rent seeking activities account for political distortions which may be mitigated in the process of fiscal decentralization while tax competition results in economic distortions associated with decentralization welfare evaluation should be based on the balance of the political gain and the economic cost

the economics of fiscal decentralization there is no complete overview or discussion of the literature of the economics of federalism and fiscal decentralization even though scholarly interest in the topic has been increasing significantly over recent years this paper provides a general brief but comprehensive overview of the main insights from the literature on fiscal federalism and decentralization in doing so literature on fiscal federalism and decentralization is grouped into two main approaches first generation approach and an emerging second generation approach the discussion generally covers the two notions of fiscal decentralization fiscal autonomy and fiscal importance of subnational governments as the background of the most recently developed index of fiscal decentralization in vo the relevance of this discussion to any further development of a fiscal decentralization index is briefly noted

the evolution of the housing market and its socioeconomic impacts in the post reform people s republic of china a survey of the literature the development of the housing market in the people s republic of china is not only a major component of chinese economic growth but also has wide ranging influential impacts on chinese society a burgeoning number of papers have examined the housing market in the postreform people s republic of china from various perspectives this paper aims to provide a thorough survey of the key literature in the field and then supply a complete picture of the dynamics of the housing market in the people s republic of china to assess the functional efficiency of this nascent market we pay particular attention to the literature that is related to the academic debate over the chinese housing bubble issue the structure and operation of the housing market is another major concern in this paper finally we summarize the key insights of the literature that we surveyed note research gaps in the literature and discuss further research directions in this field

debt bailouts and constitutions a demand based theory of sub national debt bailouts is presented it is shown that revenue sharing rs arrangements alter the demand for bailouts among politicians with regional constituencies as a bailout usually implies a shift of taxation to the federal tier automatic rs may lead to the formation of pro bailout coalitions formed by indebted states and states that are net recipients of the rs arrangement also rs can act as a commitment device for compensating payments among state representatives making a bailout politically rational the model shows that the state debt bailouts approved by the brazilian senate prior to the enactment of the fiscal responsibility act were fully consistent with politicians that maximize the proceeds accruing to their constituencies