First things first? Austerity, political parties and the composition of public budgets in the German states

The Economics of Earmarked Taxes

Tax and Spending in the 2020s

The level of spending for public services is known to be influenced by spending on other services. This interdependency is known in the literature in public budgeting and finance as budgetary tradeoffs. While it is well known that spending in one area affects spending in other areas, the factors that influence budgetary tradeoff decisions are not well understood, and specifically how intertemporal evaluation of funding influences budgetary tradeoffs is not currently addressed in the public budgeting and finance literature. Building on Jacob's theory of intertemporal policy choice, we develop a tradeoff model to test the key predictions of intertemporal policy choice theory. Using data from counties in North Carolina, we find that partisanship and time horizon generally influence budgetary tradeoffs in ways that are consistent with intertemporal policy choice. This research informs the budgetary tradeoff choices that are made at the local level, and it specifically informs the unique case of election administration spending. Our findings lend theoretical support to assertions that election administration is underfunded in the United States because the budgetary tradeoff models suggest that election administration suffers from not having a natural constituency to advocate for it in county governments and because the outcomes from funding or underfunding are only observed intermittently.

This study analyzes the impact of a high-speed rail line on tax revenues and on the economy of affected regions within the country. The economic impact of infrastructure investment can be induced by changes in tax revenues when the infrastructure is in operation. Accurate regional GDP data are not necessarily available in many Asian countries. However, tax data can be collected. Therefore, this study uses tax revenue dates in order to estimate spillover effects of infrastructure investment. The Kyushu high-speed rail line was constructed in 1991 and was completed in 2003. In 2004, the rail line started operating from Kagoshima to Kumamoto. The entire line was opened in 2011. We estimated its impact in the Kyushu region of Japan by using the differencein-difference method, and compared the tax revenues of regions along the high-speed railway line with other regions that were not affected by the railway line. Our findings show a positive impact on the region’s tax revenue following the connection of the Kyushu rapid train with large cities, such as Osaka and Tokyo. Tax revenue in the region significantly increased during construction in 1991–2003, and dropped after the start of operations in 2004–2010. The rapid train’s impact on the neighboring prefectures of Kyushu is positive. However, in 2004–2013, its impact on tax revenue in places farther from the rapid train was observed to be lower. When th Kyushu railway line was connected to the existing high-speed railway line of Sanyo, the situation changed. The study finds statistically significant and economically growing impact on tax revenue after it was completed and connected to other large cities, such as Osaka and Tokyo. Tax revenues in the regions close to the high-speed train is higher than in adjacent regions. The difference-in-difference coefficient methods reveal that corporate tax revenue was lower than personal income tax revenue during construction. However, the difference in corporate tax revenues rose after connectivity with large cities was completed. Public private partnership (PPP) has been promoted in many Asian countries. However, PPP-infrastructure in India failed in many cases due to the low rate of return from infrastructure investment. This study shows that an increase of tax revenues is significant in the case of the Kyushu rapid train in Japan. If half of the incremental tax revenues were returned to private investors in infrastructure, the rate of return from infrastructure investment would significantly rise for long period of time. It would attract stable and long-term private investors, such as pension funds and insurance funds into infrastructure investment. The last section of the paper will address how incremental tax revenues created by the spillover effects of infrastructure will improve the performance of private investors in infrastructure investment.

Purpose- The purpose of this study is to develop a first fully functional Turkish Financial Computable General Equilibrium (FCGE) model that analyzes the economic impacts of infrastructure investment projects under different financing options. We examine three alterantive financing methods, i.e., public financing with tax revenues and government bonds, public financing with region specific tax policy and private financing. Methodology- The study employs Financial Computable General Equilibrium (FCGE) model. The FCGE model integrates the real economy with the financial one, and traces the flows of financial and real resources among economic agents at the same time. Computable General Equilibrium (CGE) models typically are comparative static equilibrium models of interregional trade and location based in microeconomics, using utility and production functions with substitution between inputs. The transport system enters the spatial economy through the costs of transport services. Transport sub models are applied to feed CGE models with cost changes in the transport sector as a result of policy measures. Our model is composed of a multi-regional financial CGE model and a transport network model. Turkish Multi Regional Computable General Equilibrium model constitutes of 11 regions. The model includes ten producers, one regional household, one national (or central) government and the rest of the world. Findings- The model is designed to analyze the economic effects of fiscal policies such as the transportation investment expenditures and alternative financing approaches on economic growth and welfare. It is possible to estimate growth and distributional effects of each project based on the financing method once the information on the investment expenditures, the construction location and the changes in the accessibility generated by the project are injected into the FCGE model. As a first attempt, we builded a Financial Social Accounting Matrix (SAM) for Turkey that FCGE models need, containing the details of financial institutions and transaction of agents’ assets and liabilities. The model specifies the behaviours of ten different sectors, one household, a central government, and the rest of the world. The model is designed to analyze the impacts of highway development with different financing strategies. We examine three alterantive financing methods: it can (a) public financing with tax revenues and government bonds, (b) public financing with region specific tax policy or (c) private financing. Conclusion- The main contribution of this research is to develop a first fully functional FCGE model to analyze the economic impacts of the infrastructure investment projects and their financing options on growth and welfare in Turkish economy. We develop a first fully functional Turkish Financial Computable General Equilibrium (FCGE) model that analyzes the economic impacts of infrastructure investment projects under different financing options. There are a number of ways to finance highway infrastructure investment: fuel taxes, user fees, trust funds etc. This Financial CGE model is expected to assess the consistency of highway investment programs under different financing options, so the government can make a decision on an approval for the project based according to their benefits and costs on national level.

Europe demands that its people be culturally and intellectually equipped in the ways that are suitable for their present and future. Only in this way they will be able to live meaningful lives in person and together. Higher education institutions play a key role in developing appropriate strategies as they are responsible for preparing their students for viable development of career and citizenship. Universities and other higher education institutions are increasingly realizing that their movement is a moving target and their leadership in the field of knowledge and understanding development and transfer means a new sensitivity to a society change. They are increasingly consulting their customers. Education inspires societal progress, but at the same time, it must respond with discernment to society by developing appropriate strategies for future study programs. Graduate studies in human resource management and national security programs prepare students for an independent national budget evaluation (acting as public finance specialists) which requires high qualification. The managers of human resource in the public sector are in charge of public finance expenditure accounting and budget matters in an institution and, besides typical knowledge of the budget, must demonstrate deep knowledge of public finance and the ability to combine human resource management and public expenditure issues. In order to achieve this goal, the Master study programme in National Security at General Jonas Žemaitis Military Academy of Lithuania (MAL) partially provides the study of specialized subjects in the fields of public finance and budget planning. One of the most important subjects is the national budget which requires from the students a lot of prior knowledge in the field of budgeting and taxation systems. Estimating that the main purpose of governmental sector’s human resource management could be public finance, it is useful to show students the differences in the approach of national budget operations and tax revenue purposes. The teaching process should be based on accurately selected cases obvious for students. From a didactic point of view, a properly selected case is the one that contains a lot of differences among national, government and municipal budgets and their records in the national legal system. One of the examples that meets the above criteria is revenues collected from different taxes. Settled income from taxes are one of the most important revenues for the national budget. Moreover, the principles of diversification of government and municipal budgets could be clearly understandable for graduate students. The paper presents the advantages and disadvantages of choosing different taxes for national, state and municipal budgets concerning tax burden for different groups of society. Furthermore, the purposes of teaching students public budgeting and the principles of taxation are discussed. Amid the many preferences, the most important one could be a pattern that clearly shows different approaches to budget expenditures and tax diversification as an interrelated issue that is the amount of budget expenditures strictly correlating with taxable and non-taxable income in the public finance and depending on the budget legislation. Certainly, the indication of such relations is the essence of public finance budgeting. Practical applications are constructed from years of practice in teaching public finance, national and municipal budgets. Taxation theories were also indicated by the results of a survey carried out in a group of students studying public finance in the last academic year.

HIS SPECIAL ISSUE presents the results of a number of studies that have been undertaken in the PRIME Network of Excellence and in ERAWATCH to characterise and compare public funding of research activities and, more specifically, project funding, broadly meaning funds allocated to research teams from external agencies to perform research activities limited in time, scope and budget. The relevance of this issue in the framework of today’s public debate on how to promote research activities at the national and European level is very clear, as well as the need to dispose of systematic comparisons of the different national funding systems and of their evolution over time. Also, there is a large body of literature in science policy studies dealing with the organisation of public research funding and debating the advantages and disadvantages of the models and organisational structures; sufficient to mention the debate concerning the need to provide enough support to basic investigatordriven research and to avoid too unilateral an orientation towards immediately useful research. While building on this stock of knowledge and the conceptual models and categories developed by a number of authors (for which we refer to the theoretical part of the papers), our work has been based on an important methodological innovation — the attempt systematically to produce a set of descriptors and indicators to compare funding systems quantitatively across countries and time. Since R&D statistics largely disregard the issue of characterising the allocation channels of public money, we have devised a specific methodology based on the collection of data from public budgets and funding agencies, and then their elaboration to provide comparative indicators. At the same time, project participants had to provide systematic and standard descriptions of the funding instruments, because we knew from previous work that the lack of this information in a usable form greatly impaired comparative work. This methodological work took almost two years and is presented in detail in a companion paper published in Research Evaluation (Lepori et al, 2008a): the reader should thus refer to it to understand the background of the figures presented here. It is, however, important to understand correctly the difference (and complementarity) between this work and the development of R&D statistics as undertaken by official bodies. While the work of official bodies aims to construct a systematic set of data concerning research expenditures in a long-term and comparative perspective by collecting original data through surveys (Godin, 2005), our aim was more modest. It was to provide, through the ad hoc elaboration of existing data, the answer to some very specific and localised questions, such as comparing across countries the portfolio of public funding or measuring the evolution over time of its share in total public funding. Hence the indicators proposed in these papers are good examples of what we called ‘positioning indicators’, that is, ones aiming to characterise the position and linkages of the different actors in the national innovation systems (Lepori et al, 2008b). A second relevant feature of these indicators is that they are not meant to provide complete descriptions of the reality on their own, nor to be used T

Insufficient allocation of resources and infrastructure remains two daunting challenges of human capital development in Nigeria despite government policy measures to efficiency of resources and infrastructure development. This paper examined the effect of tax revenue proxy by value added tax and infrastructure on composite health and education in Nigeria from the period 1980- 2021. This paper utilized the simulation approach in forecasting performance of the macroeconometric model. From the results, the following were observed: First, value added tax has positive and statiscally significan effect on government expenditure on education and health. This implies that an increase in tax revenue causes increase in government’s spending on education and health in Nigeria. Second, health is not a good channel through which tax revenue can be used to influence economic growth, relative to education. Education impacts more on human capital in Nigeria than health. Three, higher investment in infrastructure or higher infrastructure will increase economic growth and human capital development. Four, positive and significant relationship exist between value added tax revenue and government expenditure on education and health. This implies that increase in tax revenue causes increase in government spending on social and community services including health and education. Five, to increase human capital development in Nigeria, temporary tax revenue shock is sufficient. This implies that the growth reducing effect of government tax via permanent increase in value added tax revenue. Six, to increase human capital development in Nigeria, permanent infrastructure development and investment is required. From the results, the following were observed: First, value added tax has positive and statiscally significan effect on government expenditure on education and health. This implies that an increase in tax revenue causes increase in government’s spending on education and health in Nigeria. Second, health is not a good channel through which tax revenue can be used to influence economic growth, relative to education. Education impacts more on human capital in Nigeria than health. Three, higher investment in infrastructure or higher infrastructure will increase economic growth and human capital development. Four, positive and significant relationship exist between value added tax revenue and government expenditureon education and health. This implies that increase in tax revenue causes increase in government spending on social and community services including health and education. Five, to increase human capital development in Nigeria, temporary tax revenue shock is sufficient. This implies the growth reducing effect of government tax via permanent increase in value added tax revenue. Six, to increase human capital development in Nigeria, permanent infrastructure development and investment is required. The study recommended that: (i) The government should increase its investment on critical infrastructure to further bolster human capital development and by extension accelerate the rate of economic growth, (ii) The government should diversify its revenue base and expend more on health and education in addition to building a strong institutional framework to ensure the efficacy of government spending on both health and education. Keywords: Tax revenue, infrastructure, composite health, education, simulation , Nigeria JEL Codes: H24, I10, E27 DOI: 10.7176/JESD/14-6-04 Publication date: March 31 st 2023

Europe demands that its people be culturally and intellectually equipped in ways that are suitable for their present and future. Only in this way will they be able to live meaningful lives in person and together. Higher education institutions play a key role in developing appropriate strategies. Higher education institutions are responsible for preparing their students for viable career development and citizenship development. Universities and other higher education institutions are increasingly realizing that their movement is a moving target and their leadership in the field of knowledge and understanding development and transfer means a new sensitivity to a society change. They are increasingly consulting their customers. Education inspires societal progress, but at the same time, it must respond with discernment to society by developing appropriate strategies for future study programs. Graduate studies in human resources management and national security programs prepare students for independent national budget evaluation (acting as the public finance specialists) which requires high qualifications. The managers of human resources in the public sector are in charge of public finance expenditures accounting and budget matters in the institution, and besides typical budget knowledge must demonstrate deep knowledge of public finance and the ability to combine human resource management and public expenditure issues. In order to achieve this goal, the national security master degree graduate program at Lithuania’s Military Academy partially provides the study of specialized subjects in the fields of public finance and budget planning. One of the most important subjects is the national budget which requires from the students a lot of prior knowledge in the field of budgeting and taxation systems. Estimating that the main purpose of the governmental sector’s human resources management could be the public finance, it is useful to show students the differences in the approach of national budget operations and tax revenues purposes. The teaching process should be based on accurately selected cases, so that it could be obvious for students. From a didactic point of view, the properly selected case is the one that contains a lot of differences between national budget, government budget, municipal budget and their records in the national law system. One of the examples that meets the above criteria is revenues collected from different taxes. Settled income from taxes is one of the most important revenues for the national budget. Moreover, principles of the government and municipal budgets diversification could be clearly understandable for graduate students. The paper presents the advantages and disadvantages of choosing the different taxes for the national, state and municipal budget concerning tax burden for different groups of society. Furthermore, purposes of teaching students subjects of public budgeting and principles of 38 taxation are discussed. Amid the many preferences the most important could be a pattern that clearly shows different approaches to budget expenditures and tax diversification as the interrelated issue, that is the amount of budget expenditures strictly correlate with taxable and non taxable income in the public finance and it depends on the budget legislation. Certainly, the indication of such relations is the essence of the public finance budgeting. Practical applications constructed on years of practice in teaching public finance, national and municipal budgets along with taxation theories were also indicated by the results of a survey carried out in a group of students studying the subject of public finance in the last academic year.

Financial education in education institutions is one of the most important tools for educating the country's citizens. Higher education institutions play a key role in developing appropriate strategies. Universities are responsible for preparing their students for viable career development and their native countries. Educational experiences of the undergraduate studies of public finance are changing over the time and especially under the contemporary pandemic conditions. Learning benefits inspire collective progress by developing appropriate strategies for future financial teaching benefits.Undergraduate studies in different social science programs prepare students for independent national budget evaluation (acting as the public finance managers) which requires high qualifications. In order to achieve this goal, bachelor degree undergraduate programs at Lithuania's Military Academy partially provide the study of specialized subjects in the fields of public finance and budget planning. From the educational experience it is obvious that the most important subject is the national budget which requires from the students a prior knowledge in the field of public finance revenue and taxation system.Estimating that the main purpose of governmental resources management could be public finance, it is beneficial to teach students about budget operations and tax revenues. The teaching process should be based on accurately selected cases, so that it could be obvious for students. From a didactic point of view, the properly selected case is the one that contains a lot of differences between national and government budget, municipal budget and their records in the national law system.One of the teaching examples that meets the above criteria could be revenue collected from public taxes. Educational presentation of different taxes is one of the educational practice learning benefits for the understanding of the national budget. Moreover, principles of government and municipal budgets diversification should be clearly understandable in the education of undergraduate students. The paper presents the teaching advantages and disadvantages of choosing the different taxes for the national, state and municipal budget. One of the most effective educational innovations is calculating by students their personal tax burden for different social life situations. Furthermore, purposes of teaching students subjects of public budgeting and principles of taxation are discussed in the example of value added tax. Amid the many preferences the most important could be a pattern that clearly shows different approaches to budget expenditures and tax diversification as the interrelated issue, that is the amount of budget expenditures strictly correlate with taxable and non taxable income in the public finance and it depends on the budget legislation. Educational experience in teaching public finance usually is constructed from years of practice.

A fundamental change of tax policy took place in Germany after the foundation of the second German Empire in 1871. The income tax was established in nearly all German states as the dominant part of the tax system (for the first time in Saxony in 1874) often in combination with a wealth tax.1 At the same time, elements of a wealth tax were also introduced at the level of the central state. In 1913, a bill was passed in the Reichstag, the German diet, which is often considered the first step towards an imperial income tax.2 Prior to the foundation of the German Empire, tax policies in the German states had been characterized by a mixture of object taxes (especially in the southern states) and personal taxes (as in Prussia and the other northern states).3 A coherent income tax order, however, had existed in none of the German states. After the foundation of the German Empire, a process of convergence among the German states and between the state and central levels began to take shape.4

German Länder (federal states) have great leeway in designing education policies. This applies to early childhood, school-based, and tertiary education—and the allocation of money to these policy domains. However, when drafting budgets, state cabinets are confronted with trade-offs because public funds are scarce: While fiscal rules limit public borrowing, Länder are barely entitled to increase taxes autonomously. Thus, budgetary trade-offs must be solved on the expenditure side. This article investigates whether party politics and the “debt brake” shape the composition of states’ education budgets. We distinguish between expenditures for early childhood education and care (ECEC), schools, universities, and other purposes. Using this categorisation, we examine the education expenses of all 16 Länder between 1995 and 2020. To capture budgetary trade-offs, the interdependence of expenditure shares (seemingly unrelated regressions) and the budget constraint (compositional dependent variables) are explicitly modelled. Our findings indicate significant partisan effects: Christian Democrats in government give universities right of way, whereas the left-wing Social Democratic Party and the Free Democrats (FDP) prioritise the expansion of public daycare. Stricter subnational fiscal rules make all parties boost relative spending on ECEC, as the expansion of childcare services was often prescribed by federal law. Nonetheless, parties differ in the speed of this expansion.

PurposeThe principles of public value management (PVM) have greatly inspired public management practitioners and scholars, but the application of these ideas to the everyday practice and research of government has proven to be more difficult. This article formulates propositions for how the principles of PVM could affect one of the core processes of government: budgeting. These propositions can inspire practitioners and be tested by future researchers.Design/methodology/approachThe article identifies the core principles of PVM and applies these to the budgeting functions of the allocation, management and accountability of public money. This exploration leads to a first conceptualization of “public value budgeting” and generates 12 propositions about how budgeting will change and remain unaltered under the influence of PVM.FindingsThe central argument is that “public value budgeting” could promote more coordination and integration between public funds and community resources, more involvement of societal stakeholders in the budgetary process and more continuous tweaks and changes to the budget. At the same time, legislative vetoes, financial controls and debates about the best use of public money will remain an important feature of public budgeting.Originality/valueThe article forwards the first conceptualization of public value budgeting, connects the literatures on public value and public budgeting, and offers both a practical application of PVM to public budgeting as well as a concrete agenda for future research.

While there is a growing global interest in tax revenue research, there has been limited efforts to present a comprehensive overview of progress in this field. Therefore, the current study aims to evaluate the productivity and performance of published works related to tax revenue. The data for the study was sourced from Scopus, which is the largest and most widely recognized database. The publications spanned from 1972 to May 2025. We employed Biblioshiny and VOSviewer to analyze bibliometric content of a total of 1,379 documents. The findings revealed that tax revenue research has kept on rising in the selected years. The most notable sources identified as key journals for publishing foundational research on tax revenue include Public Finance Review, International Tax and Public Finance, Public Budgeting and Finance, and the Journal of Tax Reform. The findings from the co-occurrence analysis highlight six significant clusters that are crucial in shaping our understanding of the main issues within the field. Each cluster encompasses a set of interconnected themes or topics that provide insights into current trends and future directions of tax revenue research. The clusters identified included: taxation and economic development, taxation and sustainability, taxation and fiscal policy, taxation and health, tax administration and taxation and local government. The country collaboration network highlighted that there is limited connection among international researchers, with partnership restricted to some areas of the globe. Tax revenue and sustainability, along with health taxes and tax reform, are anticipated to be at the core of shaping the future trajectory of research in the area. This research is essential for guiding future studies, shaping tax policy decisions, and enhancing tax administration practices, which will ultimately result in more efficient and equitable tax systems.

Within today’s German federal system, Bavaria has been uniquely successful in maintaining a distinctive identity. Bavarian politicians define and defend Bavarian interests with the kind of unabashed assertiveness that many of their colleagues from the other German states only dream of. What are the reasons for this distinctiveness? Certainly Bavaria’s economic success ranks high among possible explanations. But cultural self-imaging and economic drive intertwine in obvious ways. One might ask whether Bavaria’s recent economic success over the past three decades is not partly the result of its citizens’ historical ability to cultivate bristly distinctiveness and to draw a highly qualified workforce from Germany — and abroad — into a cultural landscape that enjoys international repute. The cultural and social meaning ascribed to traditional Bavarian customs and costumes is invariably contested by insiders and outsiders. Yet that contest itself assures the attention of outsiders far more than uniformity and standardisation ever could. Non-Germans habitually associate Germany with beer, Sauerkraut, the Autobahn, the Oktoberfest, the Nazis, Lederhosen, ‘that fairytale castle on a mountain’, and precision-engineered automobiles. Remarkably, though, these hallmarks of ‘German’ culture are at least as much Bavarian as they are German. Hence one could inquire why one federal state should attain such status as a synecdoche for the entire country.