The real impact of a one-off fiscal restriction: empirical evidence of a flypaper effect in Flemish municipalities |
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Authors: | Stijn Goeminne Carine Smolders Elke Vandorpe |
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Abstract: | This paper analyses the effects of a one-off fiscal restriction on Flemish local government spending. The authors provide evidence of a ‘flypaper effect’: fiscal restriction stimulated the sensitivity of local spending to grants. This means that higher-level governments (regional/national/supranational) need to take a flypaper effect into account when considering one-off fiscal restrictions on lower-level governments. |
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Keywords: | Fiscal restriction Flemish local government flypaper effect panel data |
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