Suchergebnisse

Abstract
This paper exploits the political cycle of Italian municipalities to test for the presence of strategic interactions in the collection of local taxation. The revenue from the personal income tax surcharge—a tax tool of low salience—is (positively) plagued by political manipulation and is found to be a strategic complement, but only when mayors run for re-election, a finding consistent with the yardstick competition hypothesis. More salient fiscal tools, such as property tax and user fees and charges, are also (negatively) affected by budget cycles, but they do not appear to be spatially correlated.

Abstract
Literature has mainly focused on understanding whether organized crime impacts on economic growth, broadly intended. Yet, at the local level, little is known as to how crime may affect economic activities. Using a unique geo-localized dataset on Italian firms, we exploit the strengthening of policy enforcement against corruption to show that when municipalities where the city council is dissolved because of organized-crime infiltration, the construction sector suffers a 7% reduction in the value added of firms located in the same area where the council dissolution occurred. We also find that the effect is larger, the longer the commissioner is present in the municipal council. Taken together our findings suggest that the action of the commissioner depresses the economic activity in the construction sector of the area where the temporary-administered municipality is located, given that it blocks all those relationships with firms related with criminality. This calls for a contemporaneous intervention stimulating public procurements with 'good' firms. (JEL codes: K42, D73, R10 and H32)

This paper investigated the fiscal interactions between Italian municipalities over the period 2001–11 and found a positive horizontal interdependence in spending decisions. The results are robust to different specifications of the spatial neighbours and are confirmed by a natural experiment (an earthquake in the Abruzzo region of Italy in 2009) that creates an exogenous variation in the neighbours' spending. Furthermore, there is no evidence of yardstick competition when one considers political effects, while a negative relationship is found between spatial interaction and the size of the municipality. Thus, it can be concluded that spillover effects drive the strategic interactions in spending decisions.

We setup a model in which the residents of two neighboring municipalities can use the services provided by public infrastructures located in both jurisdictions. If services are either complements or substitutes in use, the municipalities strategically interact when investing in infrastructures; moreover, when they differ in population size, the small municipality reacts more to the expenditure of its neighbor than the big one. The theoretical predictions are then tested by estimating the determinants of the stock of public infrastructures of the municipalities belonging to the Autonomous Province of Trento, in Italy.

The abolition of the municipal property tax on owner-occupied dwellings accomplished in Italy in 2008 offers a quasi-natural experiment that allows for the identification of the presence of political budget cycles - the incentives for municipalities close to elections to manipulate policy outcome decisions. Our empirical analysis shows that the reform impacted on municipalities that in 2008 were in their preelectoral year, by expanding the size of their budget in the form of an increase of current expenditure and fees and charges, but this did not occurred in municipalities that experienced their pre-electoral year before 2008.