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The flypaper effect revisited

Aragon, Fernando (2009) The flypaper effect revisited. Economic Organisation and Public Policy Discussion Papers (EOPP 004). Suntory and Toyota International Centres for Economics and Related Disciplines, London, UK.

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This paper argues that there is nothing anomalous about the flypaper effect. I develop a simple median voter model of government spending with costly tax collection that predicts the flypaper effect and provide a quantifiable measure of its magnitude. Using the model insights and previous estimates, I show that a tax rate between 8% to 16% would account for the flypaper effect observed in U.S. subnational governments.

Item Type: Monograph (Report)
Official URL:
Additional Information: © 2009 The Author
Divisions: STICERD
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HJ Public Finance
Date Deposited: 24 Jul 2014 09:02
Last Modified: 16 May 2024 13:15

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