scholarly journals Fiscal Centralization: Theory and Evidence from the Great Depression

2018 ◽  
Vol 10 (2) ◽  
pp. 39-61 ◽  
Author(s):  
Daniele Coen-Pirani ◽  
Michael Wooley
Keyword(s):  
Great Depression ◽  
Local Governments ◽  
Property Tax ◽  
The Great Depression ◽  
Fiscal Centralization ◽  
Us Government ◽  
Sales Taxation ◽  
State Variation ◽  
Property Tax Delinquency ◽  
Lasting Influence

The Great Depression produced a profound and lasting influence on the structure of US government. This paper studies theoretically and empirically the increased centralization of revenues and expenditures by the states relative to local governments during this period. A model of property and sales taxation and tax delinquency is introduced. In the model, the income decline of the Depression causes a rise in property tax delinquency and leads to a shift toward sales taxation and fiscal centralization by the states. Empirical evidence based on cross-state variation in the severity of the Depression is consistent with the model's key predictions. (JEL E32, H25, H71, H72, H77, N12, N42)

Distributional Impacts of State and Local Tax Policy in a Heterogeneous-agent Model

2019 ◽  
Vol 47 (6) ◽  
pp. 971-1001
Author(s):  
Jorge A. Barro
Keyword(s):  
Local Governments ◽  
Property Tax ◽  
Housing Demand ◽  
Tax Burden ◽  
Heterogeneous Agent ◽  
Economic Implications ◽  
Agent Model ◽  
Sales Taxation ◽  
State And Local ◽  
Tax Deduction

This article presents a dynamic heterogeneous-agent life-cycle model with housing demand to evaluate the economic implications of reforming US state and local personal tax structures. Because of the extensive reliance of state and local governments on income, sales, and property tax revenue, those three taxes are explicitly modeled to generate a baseline and varied to evaluate alternative policy proposals. The results of the model show that the sales tax burden falls evenly across the distribution of income earners, while the property tax burden falls more heavily on the highest income earners. By design, the model’s income tax is progressive, so the tax burden shares rise with income. Results also show that the property tax generally improves utilitarian social welfare relative to income and sales taxation, but the magnitude of these gains depends on the availability of a state and local tax deduction on federal income taxes.

Reform During Crisis: The Transformation of California's Fiscal System During the Great Depression

1996 ◽  
Vol 56 (3) ◽  
pp. 657-678 ◽  
Author(s):  
James E. Hartley ◽  
Steven M. Sheffrin ◽  
J. David Vasche
Keyword(s):  
Great Depression ◽  
Rapid Growth ◽  
Property Tax ◽  
Income Taxes ◽  
Tax System ◽  
The Great Depression ◽  
Fiscal System ◽  
Revenue Elasticity ◽  
Desire To Change

In the midst of the Great Depression, California engaged in a massive restructuring of its tax system, reducing reliance on the property tax and introducing sales and income taxes. Our analysis suggests that this restructuring, which included a voter referendum, was primarily driven by a desire to change the mix rather than the level of taxation. Nonetheless, by introducing new taxes that had a higher revenue elasticity than the existing taxes, California created a revenue system that allowed the rapid growth of spending to continue.

Capitalizing on the Urban Fiscal Crisis: Predatory Tax Buyers in 1970s Chicago

2015 ◽  
Vol 44 (3) ◽  
pp. 382-401
Author(s):  
Andrew W. Kahrl
Keyword(s):  
United States ◽  
Local Governments ◽  
Property Tax ◽  
The United States ◽  
Fiscal Crisis ◽  
Fiscal Policies ◽  
Administrative Practices ◽  
Property Tax Delinquency ◽  
The Right ◽  
Interest Payments

Local governments across the United States annually hold tax auctions, in which unpaid property tax bills are sold to investors, who in turn obtain the right to charge interest on those debts or acquire title to tax delinquent property. In Chicago, reforms to Illinois’s tax sales law in 1951 gave rise to a class of investors who reaped millions through fees, interest payments, and, in some cases, acquisition of real estate for the price of a single property tax bill. Tax buying thrived as rates of property tax delinquency rose sharply in the 1970s, especially in the city’s African American neighborhoods, which suffered from discriminatory overassessment. As the city’s fiscal situation worsened, tax buyers wielded greater influence over tax policy and administration. Tax sales shed new light on the making of contemporary municipal fiscal policies and administrative practices, and highlight broader features of capitalism and the state in modern America.

Remaking the Heartland

2011 ◽  
Author(s):  
Robert Wuthnow
Keyword(s):  
Great Depression ◽  
Social Institutions ◽  
Small Towns ◽  
Rapid Expansion ◽  
Social Transformations ◽  
The Great Depression ◽  
Objective Observer ◽  
The 1950S ◽  
Changing Times ◽  
Middle West

For many Americans, the Middle West is a vast unknown. This book sets out to rectify this. It shows how the region has undergone extraordinary social transformations over the past half-century and proven itself surprisingly resilient in the face of such hardships as the Great Depression and the movement of residents to other parts of the country. It examines the heartland's reinvention throughout the decades and traces the social and economic factors that have helped it to survive and prosper. The book points to the critical strength of the region's social institutions established between 1870 and 1950—the market towns, farmsteads, one-room schoolhouses, townships, rural cooperatives, and manufacturing centers that have adapted with the changing times. It focuses on farmers' struggles to recover from the Great Depression well into the 1950s, the cultural redefinition and modernization of the region's image that occurred during the 1950s and 1960s, the growth of secondary and higher education, the decline of small towns, the redeployment of agribusiness, and the rapid expansion of edge cities. Drawing arguments from extensive interviews and evidence from the towns and counties of the Midwest, the book provides a unique perspective as both an objective observer and someone who grew up there. It offers an accessible look at the humble yet strong foundations that have allowed the region to endure undiminished.

Sign in / Sign up

Export Citation Format

Share Document