Expenditure Limitations Research Articles

La corrupción y sus causas. Análisis cuantitativo de la corrupción utilizando proxy datasets

The purpose of this paper is to evaluate popular academic theories believed to cause corruption through quantitative dataset proxies. In undertaking the exercise, the author examines various (and often competing) schools of thought on the topic, while showcasing the challenges that burden the objective study of corruption in a global context. The paper obtains a list of sixteen (16) variables extrapolated from academic literature; each (independent) variable is tied to a proxy dataset. The variables are first analysed through univariate statistics, before being subjected to bivariate correlation analysis against the (dependent) variable of corruption (itself tied to a proxy dataset, the Corruption Perception Index). The methodology employed in the analysis involves a standard mixture of statistical techniques—descriptive statistics & charts, logarithmic normalisation, Q-Q plotting, distribution curve overlays, etc.—as well as regression techniques aimed at the analysis of possible associations. The process uncovers data limitations for at least three variables (monitoring institutions, monotheistic religion, and campaign expenditure limits), while also revealing an unexpected (negative) relationship between corruption and national levels of debt. Several variables believed to impact corruption levels are confirmed, showing that rule of law, violence and instability, and national wealth all exert a strong impact on levels of corruption; other variables exhibit smaller-thanexpected associations (e.g. freedom of the press). The paper outlines future research avenues (multicollinearity analysis coupled with a robust stepwise regression model) that would generate valuable insights into global corruption trends that can then be scaled-down to accommodate local idiosyncrasies.

Australia's Fiscal Framework: Revisiting Options for a Fiscal Anchor

This paper revisits options for fiscal anchors in Australia against the backdrop of a medium-term budget balance anchor that has led to larger than expected upward drift in the net debt to GDP ratio since the end of the mining investment boom. The IMF's G20MOD model is used to compare the budget balance anchor with a long-term debt anchor. Using model simulations evaluated against objective macro stabilization-debt control criteria under three likely scenarios for the Australian economy, the latter is found to perform at least as well as the former. The paper also considers the operationalization of a long-term debt anchor utilizing a combination of fiscal rules which includes expenditure restrictions and a flexible time horizon for convergence, aiming at encouraging countercyclical fiscal policy and minimizing the cost in terms of real GDP foregone in the medium term under fiscal consolidation.

Australia's Fiscal Framework: Revisiting Options for a Fiscal Anchor

This paper revisits options for fiscal anchors in Australia against the backdrop of a medium-term budget balance anchor that has led to larger than expected upward drift in the net debt to GDP ratio since the end of the mining investment boom. The IMF’s G20MOD model is used to compare the budget balance anchor with a long-term debt anchor. Using model simulations evaluated against objective macro stabilization-debt control criteria under three likely scenarios for the Australian economy, the latter is found to perform at least as well as the former. The paper also considers the operationalization of a long-term debt anchor utilizing a combination of fiscal rules which includes expenditure restrictions and a flexible time horizon for convergence, aiming at encouraging countercyclical fiscal policy and minimizing the cost in terms of real GDP foregone in the medium term under fiscal consolidation.

Covenants, Creditorss Simultaneous Equity Holdings, and Firm Investment Policies

We analyze how creditors' simultaneous debt and equity holding affects firm investment policies. Dual ownership firms are less likely to have capital expenditure restrictions in loan contracts and exhibit a larger decrease in asset volatility after loan origination relative to firms with no dual ownership. The effect varies in predicted ways with borrowers' monitoring needs and dual owners' monitoring capacity. Dual ownership firms are also more likely to be granted an unconditional waiver and do not significantly reduce debt issuance or investment expenditures after a financial covenant violation. Our results highlight how dual ownership can help mitigate shareholder-creditor conflicts.

A Distribution-Neutral Perspective on Tax Expenditure Limitations

A recent wave of literature, partly motivated by presidential campaign tax reform plans, analyzes tax expenditure limitation proposals. These reforms are often advanced not only, or even primarily, because they reduce distortions caused by favoritism for some types of expenditures over others. Largely they are urged for a number of other reasons: on distributive grounds, because the resulting broader base enables lower marginal tax rates and hence less distortion of labor effort and other margins, and to raise revenue without requiring higher marginal tax rates. It is generally recognized that the particular results on these dimensions are heavily dependent on what sorts of rate adjustments are used to return the proceeds to taxpayers. Often, revenue neutrality is assumed. This essay advances a complementary, distribution-neutral perspective on the analysis of tax expenditure limitations. Distribution-neutral implementation provides an illuminating benchmark against which to understand prior analysts’ large number of results and, more importantly, clarifies the analysis, particularly of the distribution-distortion trade-off. The central lessons contradict the common belief that one can have less distortion of labor supply through lower marginal tax rates while also maintaining or enhancing progressivity.

The Effectiveness and Potential Unintended Consequences of Caps on Municipal Taxation and Expenditures

In this paper, I examine how municipalities are affected by tax and expenditure limitations (TELs). The main goals of TELs are to reduce the property tax burden of local residents and reduce the size of government. I find that these goals are generally met in the short run, however expenditures do not seem to be reduced over the long term. I also examine a potential unintended consequence of TELs, a shift in the balance of service and administrative expenditures. I find signs that municipalities may increase service expenditures just before TEL implementation, followed by significant reductions just after. This study also finds that over the long term, service ratio is significantly lower for municipalities operating under tax and expenditure limitations.

The Rise of Specialized Governance in American Federalism: Testing Links Between Local Government Autonomy and Formation of Special District Governments

In this article, I investigate whether the growth of special districts in the fifty states from 1972 to 2002 can be explained by choices made by local general-purpose governments in response to different degrees of government autonomy in the fiscal, institutional, and political system. Focusing on three dimensions of government autonomy—local government capacity, local government discretion, and local government importance—I find that the growth of certain types of special districts is in part a response to state laws constraining government autonomy of general-purpose governments. The findings also suggest that reliance on special districts by local general-purpose governments would decrease if they had stronger own-source revenue-raising capacities and more diversified tax revenue bases. In contrast with prior studies, the analysis provides limited evidence to support the notion that special districts are formed by general-purpose governments to circumvent fiscal restrictions, such as debt limits and tax and expenditure limitations.

The effects of tax and expenditure limits on state fiscal reserves

To help policy makers manage expenditures during periods of economic downturns, most states have formal budget stabilization funds and unreserved fund balances. Using indices of tax and expenditure limitations laws restrictiveness, we examine the relationship between tax and expenditure limitations and state reserves for years 1992–2010 to help determine the extent to which tax and expenditure limitations constrain or in other ways affect how states manage fiscal reserves. This time period is particularly relevant because it includes two recessions and most states had budget stabilization funds and tax and expenditure limitations. Findings suggest that state-constructed tax and expenditure limitations have little effect on state capacity to react to fiscal shocks.

Tax Expenditure Limitations (TELs) and State Expenditure Structure in the USA

This paper analyzes the impact of TELs on different types of state expenditures. This study provides comparison analysis of different types of TELs on state level and aims to evaluate the effect of TEL policy on state expenditure structures. Using panel data analysis, this work finds that states with Tax Expenditure Limitations (TELs) - in addition to financial factors- are associated with higher level of state expenditures for corrections and lower levels of state expenditures for police, parks, natural resources, and highway expenditures. Looking at 50 states from 2006 to 2011, this relationship is both statistically and substantively significant.

Do thermoregulatory costs limit altitude distributions of Andean forest birds?

Summary Along tropical mountains, species often occupy narrow altitude ranges. Numerous biotic and abiotic factors have been proposed as determinants of altitude occupancy. We measured several aspects of thermal physiology of 215 bird species across a 2·6‐km altitude gradient in the Peruvian Andes. We predicted that highland species would show adaptation to the colder high‐altitude climate and that energy costs of thermoregulation might limit upslope dispersal of lowland natives. We found reductions in thermal conductance, body temperature and lower critical temperature in highland birds compared with lowland species. These combine to make highland natives more resistant to heat loss. We did not find convincing evidence that acute thermal limits or energy costs of thermoregulation constrained altitude distributions. Heat‐budget models predicted low‐to‐moderate long‐term costs at native altitudes. Costs increased for lowland natives modelled in the highland climate, but for all but a few species, costs remained within putative expenditure limits. Although we did not test heat tolerances, we measured all species at temperatures similar to the hottest air temperatures at the lowland site. There was no evidence that high lowland temperatures preclude downslope movements of highland birds. While thermal tolerances probably do not directly determine altitude occupancy by most species, the additional energy cost of thermoregulation experienced by lowland species moving upslope may trade off against investment in important life‐history components such as breeding, and thereby affect altitude range limits. A Lay Summary is available for this article.

The Impact of Tax and Expenditure Limits on Municipal Credit Ratings

The research focuses on the impact of the restrictiveness of tax and expenditure limitations (TELs) on the credit ratings of 566 U.S. municipalities over the 2007-2010 time period. The credit ratings used are by Moody’s rating agency, and municipal fiscal data are drawn from the Government Financial Officers Association’s (GFOA) Certificate of Achievement for Excellence in Financial Reporting program. Results suggest that more restrictive TELs imposed on municipalities by the states have a weak negative impact on credit ratings which will likely force municipalities to face higher interest costs.

The Effects of Tax and Expenditure Limits on Municipal Pension and Opeb Funding during the Great Recession

The Great Recession of 2008–09 caused an array of fiscal challenges for state and local governments in the US, including the underfunding of pensions and retiree health benefits (Joyce, 2013). It is estimated that in 2009 the 61 largest cities in the US had unfunded pension and retiree health benefits liabilities equal to $217 billion (The Pew Charitable Trusts, 2013). Given these constraints, we are primarily interested in understanding the effects of institutional factors, more specifically the role of tax and expenditure limitations (TELs), on pension and other post-employment benefit (OPEB) funding. Recent studies have examined the effects of pension liabilities on bond ratings (Martell, Kioko and Moldogaziez, 2013), the effects of state budget stabilization funds on pension contributions (St. Clair, 2013) and political and institutional effects on pension plan management (Gehl, Willoughby and Bell 2013); (Chen, Ebdon, Kriz and Laforge, 2013). What is less understood is the role played by institutional structures such as form of government and state-imposed tax and expenditure limitations on pension or OPEB funding before, during and after the recession. Our findings suggest that municipal TELs are statistically associated with OPEB funding, meaning that municipalities with stricter TELs had lower OPEB funding ratios. Just as importantly, we find that during this period, municipalities with mayor-council forms confronted with stricter TELs had better funded pensions and OPEBs than in cities with similar TELs but with manager-council forms of government.

A Dynamic Scoring Simulation Analysis of How TEL Design Choices Impact Government Expansion

A dynamic scoring simulation analysis compares the size-of-government effects of four state-government-level Tax and Expenditure Limit (TEL) and Budget Stabilization Fund (BSF) combinations. Two of the four TEL-BSF combinations have population-plus-inflation as the basis for the spending growth limit. The other two TEL-BSF combinations have personal-income-growth as the basis for the spending growth cap. A sensitivity analysis, including a regression analysis of Monte-Carlo-generated ‘observations’, measures the significance of the model parameter choices. The personal-income-growth TELs don’t constrain spending growth at all in some states. In most states, a TEL based on a significant multiple of population plus inflation restrains fiscal expansion more than either version of our personal income growth TEL. The findings provide some important policy issues: there are significant differences in the fiscal and economic impacts of likely TEL design alternatives, and there is a likely trade-off between stringency and political durability.

Gambling Responsibly: Who Does It and To What End?

Numerous responsible gambling (RG) strategies are promoted to assist consumers to "gamble responsibly". However, consumer adoption of RG strategies, how this varies by gambler risk group, and whether usage is associated with non-problematic gambling are largely unknown. This study aimed to (1) determine how use of RG-related strategies differs amongst regular gamblers by gambler risk group; and (2) identify RG-related strategies whose usage predicts non-problem/low risk gambling. Regular Australian gamblers on high-risk products (N=860), recruited through gambling venues and an online wagering operator, were surveyed about their use of RG strategies promoted on the website of their jurisdiction's main RG agency. Knowledge of RG strategies was reasonably high amongst all gambler risk groups, but lower-risk groups were more likely to use RG strategies. A logistic regression correctly predicted 82.1% of lower-risk gamblers and 77.2% of higher-risk gamblers. Predictors of lower-risk gambling included: greater confidence in their understanding of RG; endorsement of lower gambling expenditure and frequency limits; fewer erroneous gambling beliefs; being less likely to gamble to win money, challenge their skills/beat the odds, or forget about worries and stresses; and being more likely to gamble for pleasure/entertainment. Lower-risk gamblers were more likely to set a money limit in advance of gambling and to balance their gambling with other activities. These findings contribute to understanding which strategies are favoured by different risk groups, and which are associated with safer levels of gambling. They can guide consumer information aimed at enhancing RG consumption and future research on RG consumption.

Local Tax Limits, Student Achievement, and School-Finance Equalization

Evidence that local tax and expenditure limits (TELs) for public K-12 schools lower student achievement is widely attributed to the effects of reduced funding, but our results cast doubt on reduced funding as the primary explanation for negative effects of TELs and instead suggest the importance of the predictability of funding. Students in districts subject to more severe local tax limits in Oregon score less well on eighth-grade tests in mathematics, but reduced funding is not the reason. Our analysis expands prior work by accounting for the extent to which TELs are actually binding, as well as for both pecuniary and non-pecuniary effects of TELs. Distinguishing pecuniary and non-pecuniary effects allows us to document that the negative effect of TELs in Oregon is not due to reduced expenditures. The state’s school-finance equalization (SFE) tends to offset funding differentials, so TELs have no significant effect on funding, but even if TELs did affect funding, the negative effect of TELs on achievement is significant even if district expenditures are held constant. Instead, the negative effect of more restrictive TELs appears to work by disrupting local planning. We isolate this effect by distinguishing the more uncertain first year of each biennial budget from the second year. Our quasi-experimental design accounts for district and year fixed effects, as well as for district-specific variations in expenditures and student attributes. Results are robust to a placebo test designed to reveal spurious correlation and to several alternative specifications.

To Serve and Collect: The Fiscal and Racial Determinants of Law Enforcement

We exploit local deficits and state-level differences in tax and expenditure limits to estimate how incentives to raise revenues influence policing. In a national sample, we find that black drug arrests increase with local deficits when institutions allow officials to more easily retain fine and forfeiture revenues. Using a panel of Colorado jurisdictions, we find similar increases in black drug and DUI arrests. We also find increases in white drug arrests, but only for those who are not residents in the arresting jurisdiction. Our results show how revenue-driven law enforcement can distort police behavior and have systematically unequal racial effects.

Time budget, oxygen consumption and body mass responses to parasites in juvenile and adult wild rodents.

BackgroundThe study of changes in a host’s energy allocation in response to parasites is crucial for understanding parasite impact on both individual- and population-level processes. Experimental studies have explored such responses mainly in a single subsample of hosts per study, primarily adult males, and have only assessed either the overall energy acquisition or expenditure, rather than their different components simultaneously, or the behavioral responses. Accordingly, two fundamental questions arise: why have multiple host strategies evolved to cope with increased energy expenditure? and, which factors determine this variation (e.g. host species, identity, age)? This study provides an important step towards addressing both questions by experimentally disentangling the short-term physiological and behavioral responses of juvenile and non-reproductive adult rodents to natural levels of flea infestation. These two cohorts represent extreme cases of the energy demand continuum, as the former, in contrast to the latter, is involved in growth - a highly energy-demanding process - and may not be able to operate far below its upper limit of energy expenditure, and thus should reduce its energy expenses upon the occurrence of extra demands (e.g. due to parasitic pressure). Accordingly, we hypothesized that the response to fleas is age-dependent and varies according to the age-specific energy requirements and constraints.MethodsWe monitored the behavior and physiology of juvenile and non-reproductive adult rodents before and after experimental flea infestation. First, we used a model selection approach to search for the factors that best explained the variability in the time budget, oxygen consumption, and body mass change in response to fleas. Then, using a path analysis approach, we quantified the different pathways connecting the important associations revealed at stage 1.ResultsCompared to their flea-free counterparts, flea-infested adults groomed longer and had a higher oxygen consumption rate, but did not lose body mass. Infested juveniles also groomed longer but grew slower and had a similar rate of oxygen consumption.ConclusionsResults suggest that both juvenile and adult rodents suffer from natural flea infestation levels. However, the comparison between the responses of juveniles and adults to experimental infestation, also suggests that juveniles may reallocate their energy expenditure from growth to maintenance, while non-reproductive adults increase their energy acquisition. Such age-dependent responses suggest that juveniles may be constrained by their higher need to rest for full functioning or by an upper limit in energy expenditure. Taken together, our study provides experimental evidence that hosts can compensate for the costs incurred by parasitism through physiological and behavioral plasticity, depending on their age, which probably determines their requirements and constraints. These compensatory responses may have important implications for the population dynamics of hosts and their parasites.

Is There a Relationship between TELs and Default? Evidence from US Municipalities

The economic effects of tax and expenditure limits (TELs) have been often studied in the literature. However, little research has addressed how TELs might influence the propensity for a jurisdiction to default on its obligations. This study specifically fills that void. Overall, the results indicate that while the likelihood of default increases as TELs become more restrictive, the magnitude is not particularly large. Once decomposed, it would appear that property tax limits increase the likelihood, while expenditure limits have the opposite effect, though the latter result is insignificant. The findings are robust to a number of specifications and provide potential policy implications.

The Impact of Fiscal Limits on State Revenue Volatility

Recent headlines suggest that state revenue volatility has important consequences regarding public administration and the choices state governments make. This work explores the connection between fiscal limits—specifically, tax and expenditure limitations (TELs), balanced-budget rules (BBRs), and super-majority voting requirements (SMRs)—and state revenue volatility. While growth is the most common measure for judging the impact of fiscal constraints, there is a growing literature that argues that volatility, or risk, of state revenue streams is equally important. This work looks at 48 states (Alaska and Nebraska are dropped) over a 37-year period (1969-2005) to assess how fiscal constraints are associated with the volatility of state revenue streams. The evidence suggests that states with strict BBRs and SMRs tend to have lower levels of revenue volatility, while strict TELs tend to be associated with higher levels of revenue volatility. However, given that states often have adopted more than one of these limits, the evidence suggests that strong BBRs have a very strong moderating effect on the impact of TELs. States with super-majority rules tend to start at lower levels of volatility; however, they have little influence on the impact of the other limits.

Refinements of the Medicare Outpatient Therapy Annual Expenditure Limit Policy.

A Medicare beneficiary's annual outpatient therapy expenditures that exceed congressionally established caps are subject to extra documentation and review requirements. In 2011, these caps were $1,870 for physical therapy and speech-language pathology combined and $1,870 for occupational therapy separately. This article considers the distributional effects of replacing current cap policy with equal caps by therapy discipline (physical therapy, occupational therapy, and speech-language pathology) or a single combined cap, and risk adjusting the physical therapy cap using beneficiary characteristics and functional status. Alternative therapy cap policies are simulated with 100% Medicare claims for 2011 therapy users (N=4.9 million). A risk-adjusted cap for annual physical therapy expenditures is calculated from a quantile regression estimated on a sample of physical therapy users with diagnoses and clinician assessments of functional ability merged to their claims (n=4,210). Equal discipline-specific caps of $1,710 each for physical therapy, occupational therapy, and speech-language pathology result in the same aggregate Medicare expenditures above the caps as 2011 cap policy. A single combined-disciplines cap of $2,485 also results in the same aggregate expenditures above the cap. Risk adjustment varies the physical therapy cap by as much as 5 to 1 across beneficiaries and equalizes the probability of exceeding the physical therapy cap across diagnosis and functional status groups. One limitation of the study was the assumption of no behavioral response on the part of beneficiaries or providers to a change in cap policy. Additionally, analysis of risk adjusting the therapy caps was limited by sample size. Equal discipline-specific caps for physical therapy, occupational therapy, and speech-language pathology are more equitable to high users of both physical therapy and speech-language pathology than current cap policy. Separating the physical therapy and speech-language pathology caps is a change that policy makers could consider. Risk adjustment of the therapy caps is a first step in incorporating beneficiary need for services into Medicare outpatient therapy payment policy.