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Original Articles

Testing for Fiscal Illusion in Wisconsin Towns

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Pages 1513-1531 | Published online: 01 Dec 2008

REFERENCES

  • Puviani , A. 1960 . Teoria Della Illusione Fianziaria , Edited by: Hartmann , M. and Rexhausen , F. Berlin : Dunckerand Humbolt . Reprint. (1903)
  • Buchanan , J. and Wagner , R. 1960 . Fiscal theory and political economy , Chapel Hill, NC : University of North Carolina Press .
  • 3. Lowery, D. Limitations on taxing and spending powers: An assessment of their effectiveness. Social Science Quarterly 1983, 63 (June), 247–263. Hendrick, R. Revenue diversification: Fiscal illusion or flexible financial management. Public Budgeting and Finance 2002, 22 (4), 52–72.
  • Lowery , D. 1987a . Electoral stress and revenue structures in the American states: Searching for the elusive fiscal illusion . American Politics Quarterly , 15 ( 1 ) : 5 – 46 .
  • 5. Ibid.
  • Lowery , D. 1987b . Fiscal illusion and revenue yield in the American states: An empirical assessment . Social Science Quarterly , 68 Dec : 857 – 865 .
  • 7. Lamb, R.; Rappaport, S. Municipal bonds; McGraw-Hill: New York, 1980. Sharp, E. The Politics and Economics of the New City Debt. American Political Science Review 1986, 80 (4), 1271–1288.
  • Wagner , R. 1976 . Revenue structure, fiscal illusion, and budgetary choice . Public Choice , 25 ( 1 ) : 45 – 61 .
  • Oates , W. 1979 . “ Lump-sum intergovernmental grants have price effects ” . In Fiscal federalism and grants-in-aid , Edited by: Oakland , W. and Mieszkowski , P. Washington, D.C : The Urban Institute .
  • Mills , J. S. 1848 . Principles of political economy , London : Longmans, Green and Co .
  • Buchanan , J. and Wagner , R. 1977 . Democracy in deficit: The political legacy of Lord Keynes , New York : Academic Press .
  • 12. Becker, E. The illusion of fiscal illusion: Unsticking the flypaper effect. Public Choice, 86, 85–102. Bowman, J. Tax Exportability, intergovernmental aid and school finance reform. National Tax Journal 1974, 27, 163–73. Case, A.; Hines, J.; Rosen, H. Budget spillovers and fiscal policy interdependence: Evidence from the states. Journal of Public Economics 1993, 52, 285–307. Gramlich, E. & Galper, H. State and local fiscal policy behavior and federal grant policy. Brooking Papers on Economic Activity, 1. Gamkhar, S. & Oates, W. Asymmetries in the response to increases and decreases in intergovernmental grants: Some empirical findings. National Tax Journal 1996, 49, 501–512. Knight, B. Endogenous federal grants and crowd-out of state government spending: Theory and evidence from the federal Highway Aid Program. American Economic Review 2002, 92 (1), 71–92. Winer, S. Some evidence on the effect of the separation of spending and taxing decisions. Journal of Political Economy 1983, 91, 126–40.
  • 13. Bowman, J. Tax exportability, intergovernmental aid and school finance reform. National Tax Journal, 27. Feldstein, M. Wealth neutrality and local choice in public education. American Economic Review 1975, 65. Inman, R. Towards an econometrics model of local budgeting. In Proceedings of the 64th Annual Conference on Taxation 1971, National Tax Association, Kansas City. Weicher, J. Aid Expenditures, and Local Government Structure. National Tax Journal 1972, 25.
  • Grossman , P. 1990 . The impact of federal and state grants on local government spending: A test of the fiscal illusion hypothesis . Public Finance Quarterly , 18
  • Winer , S. 1983 . Some evidence on the effect of the separation of spending and taxing decisions . Journal of Political Economy , 91 : 126 – 40 .
  • Hewitt , D. 1996 . Fiscal illusion from grants and the level of state and federal expenditures . National Tax Journal , 39 : 471 – 83 .
  • 17. Lowery, 1987a, op. cit.
  • Johnson , T. and Ihrke , D. M. 2004 . Determinants of conflict on Wisconsin town boards . State & Local Government Review , 36 ( 2 ) : 103 – 117 .
  • 19. Verba, S.; Nie, N. Participation in America; University of Chicago Press: Chicago, 1972. Jones, B. D.; Greenberg, S. R.: Kaufman, C.; Drew, J. Bureaucratic response to citizen-initiated contacts: Environmental enforcement in Detroit. The American Political Science Review 1977, 71, 148–165. Verba, S.; Schlozman, K.; Brady, H. Voice and equality; Harvard University Press: Cambridge, MA, 1995. Oliver, J. E. Democracy in suburbia; Princeton University Press: Princeton, NJ, 2001.
  • 20. Lowery op. cit. Lowery op. cit.
  • Wisconsin . 2003 . “ Legislative Reference Bureau ” . In State of Wisconsin Blue Book , 2003 – 2004 . Madison, WI : Joint Committee on Legislative Organization .
  • 22. The University of Wisconsin-Extension collects annual financial data from all Wisconsin municipalities and makes it available through a database program called G.R.E.A.T. These are not GAAP compliant audited financial statements, rather annual financial reports required and audited by the State of Wisconsin for aid distribution reports.
  • 23. Towns contained in Menominee County were excluded from this analysis. In this case, the “town” is the county and governed by a single-tier consolidated structure that has seven board members. There are no towns located in Milwaukee County.
  • 24. It has been suggested that we use electoral data for this analysis. However, the state of Wisconsin does not require that electoral data be archived and therefore it is not readily available.
  • Verba et al., op. cit , Verba , S. , Schlozman , K. and Brady , H. Voice and equality , Cambridge, MA : Harvard University Press .
  • 26. We do not assume that constituents are only contacting officials on matters directly related to financial matters; only that more contacting gets the attention of the official.
  • 27. Johnson et al., op. cit.
  • Sokolow , A. D. 1982 . Small Town Government: The Conflict of Administrative Styles . National Civic Review , October : 445 – 452 .
  • 29. Ibid. Lynd, R. S.; Lynd, H. M. Middletown: A Study in contemporary American culture; Harcourt, Brace and Company: New York, 1929. Blumenthal, A. Small-Town stuff; University of Chicago Press: Chicago, 1932. Wikstrom, Nelson. The political world of a small town: A mirror image of American politics; Greenwood Press: Westport, CT, 1998.
  • Wisconsin Taxpayers Alliance . 1999 . The Wisconsin taxpayer . Wisconsin Taxpayers Alliance , 67 ( 45 )
  • 31. Lowery 1987a, op. cit.
  • 32. Lowery 1987a, op. cit. Lowery, 1987b, op. cit.

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