Chapter 8: Majoritarian exploitation of the fiscal commons: general taxes–differential transfers
Do majoritarian democracies overexploit the general tax base, akin to the tragedy of the commons? Or, apart from any consideration of efficiency norms, are there “natural” forces in majoritarian politics that keep tax rates below revenue-maximizing limits? This paper formulates the fiscal process through the metaphor of the commons and analyzes the equilibrium that emerges in settings where differing majority coalitions may operate simultaneously to place charges on the general taxable capacity of the economy. The presence of a “membership externality,” emergent from the necessary intersections of members among separate majority coalitions, acts to limit fiscal exploitation, even in the pure transfer settings.
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.