Political Failures and Intergovernmental Competition

الملخص EN

In normative public economics, intergovernmental competition is usually viewed as harmful.

Although empirical support for this position does not abound, market integration has intensified competition among developed countries.

In this paper we argue that when assessing welfare effects of intergovernmental competition for various forms of political failures (the public choice critique), the outcome is ambiguous and competition can be welfare improving.