研究報告書

The incentive for reducing the expenditures in local governments and resident migration

eng

比較経済研究所ワーキングペーパー

129

1

19

2007-03-10

Version of Record

ガバナンスの比較セクター分析 : ゲーム理論＋契約理論によるアプローチ;2

This paper examines the incentives for local governments to improve their own fiscal balances in an environment of interregional resident migration, and shows that whether a local government will make its fiscal balances efficient depends on the condition of population distribution. As residents migrate between regions to get a higher utility, their utility will become equal at a migration equilibrium. We obtain the following results from this property of resident migration: a local government will improve its own fiscal balance efficiently when the utility of residents in the other region increases with emigration from there. lf the residents' utility in the other region decreases, a local government will have a incentive to deteriorate its own fiscal balance. However residents' utility will not decrease under this incentive．

Working Paper