Abstract
The Commonwealth Grants Commission represents a sophisticated institutional method of dealing with the problem of horizontal fiscal imbalances in Australia, which has managed to combine equity and efficiency considerations without untoward political bias. By contrast, the problem of vertical imbalance has been addressed by specific purpose payments, which are much more amenable to party political calculation, and can thus be employed to maximise electoral support. This note briefly reviews public finance and public choice models of intergovernmental grant determination and shows that a public choice perspective can shed at least some light on how party political factors may influence grants like specific purpose payments.
Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
