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Keywords:state finances 

Working Paper
State capital taxes and the location of investment: empirical lessons from theoretical models of tax competition

Applying insights from theoretical tax competition models, this study of manufacturing investment and taxes in U.S. states makes four contributions to the empirical tax competition literature. First, while the existing empirical literature has assumed exogenous tax rates, the theoretical model, which endogenizes state tax rate choices, demonstrates that tax rates and investment decisions are determined by the same set of jurisdiction characteristics. The endogeneity corrected estimates, which rely on instruments motivated by the theoretical model, suggest stronger responses to tax rates than ...
Finance and Economics Discussion Series , Paper 2002-59

Journal Article
Interstate fiscal disparity in 1997

Readily available tax statistics tell state and local policymakers the amount and mix of revenues that their governments receive. However, these officials pose harder fiscal questions than simply how much money is flowing into their coffers and from what sources. They frequently ask, What is our state's capacity to raise revenues, regardless of how much we actually collect? To what extent do we utilize that capacity? Is our revenue capacity sufficient to finance our state's need for public services? These questions are especially salient today, given that during state fiscal year 2002 ...
New England Economic Review , Issue Q 3 , Pages 17-33

Journal Article
Come the devolution, will states be able to respond?

Since the founding of the Republic, Americans have engaged in endless debate about the division of fiscal and regulatory responsibilities among levels of government. The controversy has often involved the concomitant question of the optimal role of government as a whole. The issue has been not only which level of government should do what, but also what government at any level should do.
New England Economic Review , Issue May , Pages 53-73

Journal Article
When States Default: Lessons from Law and History

This Commentary discusses how a severe fiscal crisis at the state level could impact the interests of the state?s public pension holders. Drawing lessons from the relevant laws, historical precedents, and the case of Arkansas after its default in 1933, I argue that in spite of the protections that exist, no public retirement system is completely immune to impairment if the money runs out.
Economic Commentary , Issue October

Speech
Impact of the Great Recession on public schools in the region

Remarks at the Quarterly Regional Economic Press Briefing, New York City.
Speech , Paper 74

Journal Article
Assessing state business climate indexes

Indexes that rank state business climates figure prominently in debates about economic policy. But empirical evidence is rarely examined on which index factors actually correlate with economic growth. A statistical analysis suggests that state business climate indexes that focus on taxes and business costs are more closely associated with growth than indexes that measure productivity and quality of life. However, these business climate elements are less important for growth than nonpolicy factors, such as climate and population density.
FRBSF Economic Letter

Journal Article
Thinking about the deductibility of state and local taxes

Business Review , Issue Jul , Pages 15-23

Journal Article
Lessons from variations in state Medicaid expenditures

Because Medicaid is absorbing a large and growing share of government spending in every state, policymakers are under intense pressure to control the cost of this budget-breaking program. In search of clues concerning Medicaid cost containment, this article examines state data on per-recipient Medicaid spending by type of service. This effort suggests focusing on nursing homes, because per-recipient payments to these institutions are highly variable across states. Indeed, the article concludes that a key explanation for cross-state differences in per-recipient Medicaid expenses is the ...
New England Economic Review , Issue Jan , Pages 43-66

Journal Article
The going gets tough: state and local governments confront the nineties

Economic Perspectives , Volume 15 , Issue May

Journal Article
Put it on my ... er, his tab

Opinion polls show a big gap between the public's desire for services and its willingness to pay for those services
Fedgazette , Volume 16 , Issue Jan , Pages 5-7

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