The determinants of off-budget activity of state and local governments

Marlow, Michael L.; Joulfaian, David

doi:10.1007/bf00153395

Cited by 37 publications

(30 citation statements)

References 23 publications

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“…As Borcherding et al (2004) have emphasized in a more general context, governments try to obscure both their spending and the tax requirements associated with that spending. Also, elected officials generally act as though they do not believe that voters exhibit rational expectations with respect to current versus future expenditures (Marlow and Joulfaian 1989, Joulfaian and Marlow 1991). Ura and Socker (2011) summarize this argument as follows: ‘Fiscal illusion theory argues that factors that attenuate the link between taxes and government spending (such as deficit financing or tax complexity) distort perceptions of the costs and benefits of government services and can lead to inefficient resource allocations.’ Therefore, current governments act as though they can provide current voters with the benefits of projects and can defer the costs to future politicians and/or future (myopic) users (usually some other set of future voters).…”

Section: The Goals Of Ppp Participantsmentioning

confidence: 99%

The Political Economy of Public‐private Partnerships and Analysis of Their Social Value*

Boardman

Vining

2012

Ann Public Coop Econ

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This article applies political economy theory to public-private partnerships (PPPs). First, we propose that social welfare is the appropriate normative evaluation criterion to evaluate the social value of PPPs. Second, we specify the goals of PPP participants, including private-sector partners and governments. Third, we review the observed outcomes of PPPs and analyze them from both a political economy perspective and a social welfare perspective. Fourth, based on a comparison of the actual outcomes of PPPs to normatively desirable social welfare outcomes, we propose some 'rules for governments' concerning the design of government PPP institutions and the management of PPPs. We argue that if governments were to adopt these rules there would be fewer PPPs in total, they would be more like traditional government contracts and there would be a greater likelihood of improved social welfare. However, political economy theory also explains why implementation of any reform will be difficult. La economía política de las alianzas público-privadas. Análisis de su valor socialEste artículo aplica la teoría de la economía política a las alianzas público-privadas (PPPs). Los autores proponen, en primer lugar, el bienestar social como criterio apropiado para evaluar las PPPs. Precisan, a continuación, los objetivos de los participantes en las PPPs, tanto de los socios privados como de los gubernamentales. En tercer lugar, pasan revista a los resultados observados en las PPPs y los analizan simultáneamente desde perspectivas de economía política y de bienestar social. Porúltimo, se basan en una comparación de resultados efectivos de las PPPs con resultados normativamente deseables en términos de bienestar social, proponiendo a los gobiernos algunas "reglas" * We would like to thank Piet de Vries for helpful comments on an earlier version of this article.

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Section: The Goals Of Ppp Participantsmentioning

confidence: 99%

The Political Economy of Public‐private Partnerships and Analysis of Their Social Value*

Boardman

Vining

2012

Ann Public Coop Econ

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“…For example, several authors have attributed circumvention of property tax limits to an increase in state power or, conversely, devolution to lower levels of government (Rueben 1995;Sokolow 1998;Skidmore 1999;Sokolow 2000;Citrin 2009). Other authors have pointed to the increase in "off-budget-enterprises," frequently taking the form of accounting tricks or innovative financial debt products (Bennett and DiLorenzo 1982;Marlow and Joulfaian 1989).…”

Section: Literature Reviewmentioning

confidence: 99%

Fee for Service: Proposition 13 and Municipal Revenue Substitution

Seljan¹,

McCubbins²

2015

CJPP

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Municipalities in California are highly reliant on charges and fees to fund government services. This paper tests whether their dependence can be causally attributed to Proposition 13. We draw our conclusions by leveraging a component of the law that causes constraint from Proposition 13 to be heterogeneous among California municipalities. Specifically, because home sales lead to property reassessments, municipalities with high homeowner stability are more constrained by Proposition 13 than those with low homeowner stability. Our analysis shows that homeowner stability is associated with greater revenue per capita and increased reliance on charges and fees following the passage of Proposition 13. We do not observe the same pattern for renter stability and conclude that Proposition 13 causes revenue substitution to charges and fees.

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“…The use of circumventions to referenda has been noted (Hildreth 1993) as has the shift of expenditures from "on-budget" to "off-budget'' following restrictions on borrowing and spending (Bennett and DiLorenzo 1982;Marlow and Joulfaian 1989). In fact, Bennett and DiLorenzo (1982) have shown that the growth of off-budget debt exceeded that of voter approved debt.…”

Section: Debt Limits and Borrowing Patterns 343mentioning

confidence: 99%

Debt Limits and Borrowing Patterns in Twelve Southeastern States: Where There's a Will….

Kelly

Massey²

1996

Southeastern Political Review

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Each year thousands of professional public administrators are taught the principles of capital budgeting and bond finance even as state legislatures move to restrict the ability of those administrators to practice what they have learned. The local borrowing decision is increasingly made at the ballot box, where cost‐benefit analysis is not as important as a good advertising campaign. Public administrators have long recognized that more democracy may mean less efficiency. This review of the way twelve southeastern states responded to borrowing restrictions, especially referenda requirements, suggests that the imposition of such restrictions may achieve results that are neither democratic nor efficient.

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The determinants of off-budget activity of state and local governments

Cited by 37 publications

References 23 publications

The Political Economy of Public‐private Partnerships and Analysis of Their Social Value*

The Political Economy of Public‐private Partnerships and Analysis of Their Social Value*

Fee for Service: Proposition 13 and Municipal Revenue Substitution

Debt Limits and Borrowing Patterns in Twelve Southeastern States: Where There's a Will….

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