commission on fiscal imbalance 合集

4 yet it must be said that whereas inter cantonal

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Unformatted text preview: e access to government, increase their capacity to control the budgets and reduce political and bureaucratic leeway in rent-seeking behaviour. In Hirschman's terminology, they not only have the "exit" (Tiebout-style mobility), but also the "voice" solution. The outcomes are that the growth of government activity has been significantly lower than in representative democracy (POMMEREHNE and SCHNEIDER, 1978), the size of government is limited (POMMEREHNE, 1978) and public expenditures are driven by the demand side 3 (KIRCHGÄSSNER and POMMEREHNE, 1990). 2.4. Co-operative federalism The federal and cantonal Constitutions permit intensive horizontal co-operation at the cantonal and communal levels of government. This horizontal co-operation is important for the principle of fiscal equivalence (OLSON, 1969), so that the circles of deciders, beneficiaries and payers coincide. The Cantons and communes are free to conclude agreements with one another on co-operation in the most varied areas and so establish themselves the optimum size of area necessary for the performance of government tasks, for example the provision of certain public goods, from University funding (inter-cantonal co-operation) to school districts and water provision (inter-communal co-operation).4 Yet it must be said that whereas inter-cantonal “concordats” are quite a success for many cantonal public policies and functions (financing the Universities is a good example), they have failed with regard to taxation, left widely unrespected or without real content as for the law on (formal) tax harmonisation (see section 5), under the motive of tax competition or the arguments of regional growth policies. ♦ Horizontal "face-to-face" co-operation between the Cantons has taken another form which was not foreseen in the Constitution. When the need for a nation-wide steering policy arises, fiscal federalism in theory suggests that this should be realised at the centre, by the federal government. This is not always the case in Switzerland where the Cantons have organised themselves horizontally in a set of powerful Committees, the so-called Conferences of Cantonal Ministers, one for each department in the administrative division of government executives, of which the Conference of the Cantonal Ministers of Finance (CCMF) is the most influential. From a constitutional point of view, fiscal/financial relations between the federal government and the Cantons cannot be tailored according to individual cantonal particularities or wishes. Equality of treatment applies, except within the equalisation law. Although each canton could challenge or negotiate individually fiscal/financial arrangements with the federal government, no single canton would have much chance in succeeding in modifying fiscal/financial arrangements for its own objectives, since any change applies (and indeed should be acceptable) to the other cantons. Within the Conferences, the Cantons negotiate common policies without interference from the centre, then...
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This note was uploaded on 03/06/2013 for the course ECON 220 taught by Professor Paulo during the Spring '13 term at University of Liverpool.

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