Abstract
In demonstrating the allocative efficiency gains resulting from decentralization of democratic decision-making regarding service levels, Oates’ decentralization theorem assumed that the resulting service costs are matched by willingness to pay on the part of local voters (see Chapter 2). In principle, this should be the individual service user paying user-charges, unless markets would fail to achieve allocative efficency in the local government jurisdiction. In that case, local government intervention is required to deal with market failure, (see Chapter 1). Such intervention does not necessarily preclude use of charges, only partial subsidies being justified except in the case of local public goods (see Chapter 7).
Part at least of the financial resources of local authorities shall derive from local taxes and charges of which, within the limits of statute, they have the power to determine the rate.
(European Charter of Local Self-Government: Article 9)
This is a preview of subscription content, log in via an institution.
Preview
Unable to display preview. Download preview PDF.
Author information
Authors and Affiliations
Copyright information
© 1999 Stephen J. Bailey
About this chapter
Cite this chapter
Bailey, S.J. (1999). The Economics of Local Government Taxation. In: Local Government Economics. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-27415-4_8
Download citation
DOI: https://doi.org/10.1007/978-1-349-27415-4_8
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-0-333-66908-2
Online ISBN: 978-1-349-27415-4
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)