Central Command, Local Hazard and the Race to the Top

33 Pages Posted: 10 Oct 2009

See all articles by Federico Revelli

Federico Revelli

University of Turin

Edoardo Di Porto

University of Naples Federico II - CSEF - Center for Studies in Economics and Finance

Date Written: September 28, 2009

Abstract

This paper explores for the first time the consequences of centrally imposed local tax limitations on the modelling and estimation of spatial auto-correlation in local fiscal policies, and compares three spatial interaction estimators: a) the conventional maximum likelihood estimator that ignores censoring; b) a spatial Tobit estimator; c) a discrete hazard estimator. Implementation of the above empirical approaches on the case of local vehicle taxation in Italy provides a reasonably coherent picture in terms of the direction and size of the spatial interaction process, and offers a plausible spatial interpretation of the race to the top in provincial vehicle taxes.

Keywords: vehicle taxation, spatial auto-correlation, censored data

JEL Classification: C23, C25, H72

Suggested Citation

Revelli, Federico and Di Porto, Edoardo, Central Command, Local Hazard and the Race to the Top (September 28, 2009). U. of Torino Department of Economics Research Paper No. 9/2009-GE. Available at SSRN: https://ssrn.com/abstract=1486022 or http://dx.doi.org/10.2139/ssrn.1486022

Federico Revelli (Contact Author)

University of Turin ( email )

Via Po 53
Facolta di Scienze Politiche
10124 Torino
Italy

Edoardo Di Porto

University of Naples Federico II - CSEF - Center for Studies in Economics and Finance ( email )

Via Cintia
Complesso Monte S. Angelo
Naples, Naples 80126
Italy

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