Can Fiscal Transfers Increase Local Revenue Collection? Evidence from the Philippines

  title={Can Fiscal Transfers Increase Local Revenue Collection? Evidence from the Philippines},
  author={Erin Troland},
  journal={PSN: Taxation (Topic)},
The power to tax is critical to economic development. In developing countries, 40-60% of potential revenues go uncollected, and local funding for public goods is limited. Federal governments often provide substantial transfer money to increase spending on local public goods. However, standard theory predicts localities will primarily use this money to decrease, or "crowd out," local tax collection. I present new causal evidence that, contrary to standard theory, transfers increase or "crowd in… Expand
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