The Impact of Fiscal Federalism: An Analysis on local, Regional and National levelsedit
IPRA grant (IWEPS), 2020-2024
This research project studies the impacts of fiscal federalism and decentralization in Belgium across local, regional and international contexts. Locally, I will examine the impacts of local property taxation on household revenue composition and firm mobility across Walloon municipalities. Hence, I will be able to evaluate and compare the impact on the local economic fabric and the changes in resident income composition over time by combining time and spatial differences with an instrumentation strategy. Regionally, I will research the impact of changes in registration fees, a type of transaction tax, on residential mobility, which will be measured by the transaction rates of property purchases. To do this, I will examine the effect of changes in registration fee tax rates on property transactions along the Walloon/Flanders linguistic border. This particular study will use a regression discontinuity design (RDD) as an identification strategy. And internationally, I will explore the welfare effects of increasing the share of local taxes to finance health spending on a regional level. Accordingly, I will investigate the exogenous changes in inter- and intra-regional health disparities after the implementation of decentralization tax reforms in more than five OECD countries. Following Di Novi et al. (2019), I exploit blatant differences in income levels and tax bases across regions to apply a difference-in-differences (DiD) approach and capture the impact of the reforms on health care disparities.