Fiscal Competition by Ricardo Varsano, Sergio G. Ferreira e José R. Afonso published in the International Conference on federalism 2002. “In the absence of clear-cut conclusions from both the theoretical and the empirical literature, the wisest attitude toward fiscal competition seems to be the avoidance of extreme measures either to impede or to enhance competition. Hence, controls or recentralization may be welfare-reducing measures insofar as they eliminate political competition among jurisdictions or create the environment for the Leviathan to rise.” See PDF Attached
Fiscal Competition (Varsano et al.)
