Abstract
In the run-up to the formation of the EC Single Market in 1992, all border controls for intra-EC trade will cease to exist. In this paper we are asking which of the discretionary-budget-maximizing governments will benefit or lose from this institutional change. The elimination of border controls leaves governments with four options of adjustment. Each of these alternatives is addressed, following the presentation of a very simple politico-economic general equilibrium model. As the main conclusion, it turns out that only the centralisation of taxing power on a supranational level can under certain conditions increase the discretionary benefit of governments.
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 callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
