Soft Budget Constraints in German Fiscal Federalism: Lessons for Fiscal Governance

Dr. Björn Gehrmann

doi:10.5771/9783845226484

Summary

Der Finanzföderalismus zeichnet sich durch eine inhärente Ineffizienz aus, die gerade in den letzten zwei Jahrzehnten besonders sichtbar wurde: nachlässige Budgetbeschränkungen. Der Band trägt zur Erforschung des Finanzföderalismus mit der Absicht bei, die Erwartungen an subnationale Rettungsprogramme zu erklären und kosteneffiziente Lösungen zu empfehlen.

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Bibliographic data

Edition: 1/2010
Copyright year: 2010
ISBN-Print: 978-3-8329-5885-5
ISBN-Online: 978-3-8452-2648-4
Publisher: Nomos, Baden-Baden
Series: Neue Studien zur Politischen Ökonomie
Volume: 9
Language: English
Pages: 225
Product type: Book Titles

Titelei/Inhaltsverzeichnis No access Pages 2 - 26 Björn Gehrmann
1. 1. Björn Gehrmann
    1. Björn Gehrmann
      1. The Decentralization Theorem No access Björn Gehrmann
      2. Optimal Jurisdictional Size No access Björn Gehrmann
      3. Interjurisdictional Spillovers and Intergovernmental Grants No access Björn Gehrmann
      4. Institutional Congruence No access Björn Gehrmann
    2. Positive Vertical FGT: Competition among Tiers No access Björn Gehrmann
    3. Normative Horizontal FGT: Locational Efficiency No access Björn Gehrmann
    4. Positive Horizontal FGT: Competition among Jurisdictions No access Björn Gehrmann
    5. Summary No access Björn Gehrmann
  2. Björn Gehrmann
    1. Björn Gehrmann
      1. Methodological Individualism No access Björn Gehrmann
      2. Transaction Costs No access Björn Gehrmann
      3. Property Rights No access Björn Gehrmann
      4. Agency Costs No access Björn Gehrmann
      5. Incomplete contracts No access Björn Gehrmann
    2. The ‘Industrial Organization’ of States No access Björn Gehrmann
    3. Federal Governance No access Björn Gehrmann
    4. Björn Gehrmann
      1. Accountability and Spillovers No access Björn Gehrmann
      2. Innovation No access Björn Gehrmann
    5. Positive Vertical SGT: Yardstick Competition No access Björn Gehrmann
    6. Normative Horizontal SGT: Coasian Contracts No access Björn Gehrmann
    7. Positive Horizontal SGT: Yardstick Competition No access Björn Gehrmann
    8. Summary No access Björn Gehrmann
  3. Interim Summary: Towards Evolutionary Federalism No access Pages 64 - 66 Björn Gehrmann
2. 1. Federalism in the Basic Law No access Pages 66 - 70 Björn Gehrmann
  2. Björn Gehrmann
    1. Three-tiered system No access Björn Gehrmann
    2. Björn Gehrmann
      1. Legislative No access Björn Gehrmann
      2. Executive No access Björn Gehrmann
      3. Judiciary No access Björn Gehrmann
    3. Vertical Federal Solidarity No access Björn Gehrmann
  3. Björn Gehrmann
    1. Equality of the Länder No access Björn Gehrmann
    2. Horizontal Federal Solidarity No access Björn Gehrmann
  4. Björn Gehrmann
    1. Björn Gehrmann
      1. The Principle of Connexity No access Björn Gehrmann
      2. The Principle of Budgetary Autonomy (Art. 109 GG) No access Björn Gehrmann
      3. The Division of Fiscal Competences (Art. 105 GG) No access Björn Gehrmann
      4. Borrowing Restrictions (Art. 115 GG) No access Björn Gehrmann
    2. Björn Gehrmann
      1. The Länder level: Interstate Equalization No access Björn Gehrmann
      2. The Municipal Level: Intrastate Equalization No access Björn Gehrmann
  5. No Bankruptcy of Corporations under Public Law No access Pages 88 - 89 Björn Gehrmann
  6. Björn Gehrmann
    1. Centralization No access Björn Gehrmann
    2. Institutional Incongruence No access Björn Gehrmann
    3. The Soft Budget Constraint No access Björn Gehrmann
    4. Incentive Distortion: Inter- and Intrastate Equalization No access Björn Gehrmann
  7. Interim Summary: German Federalism – Stable, Static and Stagnating No access Pages 95 - 98 Björn Gehrmann
1. 1. The Soft Budget Constraint: Definition and Rationale No access Pages 99 - 103 Björn Gehrmann
  2. Björn Gehrmann
    1. The Bailout Game No access Björn Gehrmann
    2. Björn Gehrmann
      1. The Model No access Björn Gehrmann
      2. Systemic Relevance No access Björn Gehrmann
      3. Deficit Sensitivity No access Björn Gehrmann
      4. Return on Political Investment No access Björn Gehrmann
      5. Two Fictitious Calculations No access Björn Gehrmann
  3. The Market-Induced Soft Budget Constraint No access Pages 127 - 130 Björn Gehrmann
  4. Björn Gehrmann
    1. International Financial Crises No access Björn Gehrmann
    2. Björn Gehrmann
      1. Federal Tier: Sovereign Bankruptcy No access Björn Gehrmann
      2. Länder Tier: State Bankruptcy No access Björn Gehrmann
      3. Municipal Tier: Municipal Bankruptcy No access Björn Gehrmann
    3. Björn Gehrmann
      1. The German Länder No access Björn Gehrmann
      2. Björn Gehrmann
        Calculation for Brandenburg (with and without Berlin) No access Björn Gehrmann
      3. Application to the Private Sector: Firm and Bank Bailouts No access Björn Gehrmann
  5. Interim Summary: Size Matters No access Pages 145 - 148 Björn Gehrmann
2. 1. Björn Gehrmann
    1. Corporate vs. Public Sources of Finance No access Björn Gehrmann
    2. Corporate vs. Public Financial Management No access Björn Gehrmann
    3. Summary: Similarities and Differences No access Björn Gehrmann
  2. Björn Gehrmann
    1. The Separation of Ownership and Control No access Björn Gehrmann
    2. The Agency Costs of Equity: Overinvestment No access Björn Gehrmann
    3. The Separation of Liability and Control No access Björn Gehrmann
    4. The Agency Costs of Debt: Underinvestment and Overborrowing No access Björn Gehrmann
    5. Summary: The Equivalence of Firms and Governments in Germany No access Björn Gehrmann
  3. Björn Gehrmann
    1. Corporate Governance: Definition and Rationale No access Björn Gehrmann
    2. Björn Gehrmann
      1. Bonuses No access Björn Gehrmann
      2. Stock Options No access Björn Gehrmann
    3. Björn Gehrmann
      1. Dilution No access Björn Gehrmann
      2. Concentration No access Björn Gehrmann
    4. Control regimes No access Björn Gehrmann
    5. Liability regimes No access Björn Gehrmann
    6. Regulatory regimes No access Björn Gehrmann
  4. Björn Gehrmann
    1. From Corporate Governance to Fiscal Governance No access Björn Gehrmann
    2. Fiscal Governance: Definition and Rationale No access Björn Gehrmann
    3. Björn Gehrmann
      1. Performance-based bonuses No access Björn Gehrmann
      2. Rating-based bonuses No access Björn Gehrmann
    4. Björn Gehrmann
      1. Dilution No access Björn Gehrmann
      2. Concentration No access Björn Gehrmann
    5. Björn Gehrmann
      1. Coalition Decision No access Björn Gehrmann
      2. Parliamentary Impeachment No access Björn Gehrmann
    6. Björn Gehrmann
      1. Receivership No access Björn Gehrmann
      2. Bailout No access Björn Gehrmann
      3. Public Bankruptcy No access Björn Gehrmann
      4. Abolition of Debt Financing No access Björn Gehrmann
    7. Björn Gehrmann
      1. ‘National Stability Pact’ No access Björn Gehrmann
      2. Constitutional Debt Brake No access Björn Gehrmann
      3. Balanced Budget Rule No access Björn Gehrmann
      4. Lending Ceilings No access Björn Gehrmann
  5. Interim Summary: Agency Cost-Effective Governance No access Pages 188 - 190 Björn Gehrmann
1. 1. Björn Gehrmann
    1. Reward Regimes: Performance-Based Pay No access Björn Gehrmann
    2. Control Regimes: Coalition Decision and Impeachment No access Björn Gehrmann
  2. Björn Gehrmann
    1. Ownership Regimes: Reform of Political Geography No access Björn Gehrmann
    2. Liability Regimes: Alignment of Liability and Control No access Björn Gehrmann
  3. Six Reform Scenarios No access Pages 195 - 197 Björn Gehrmann
  4. Interim Summary: Good Fiscal Governance No access Pages 197 - 198 Björn Gehrmann
2. 1. Björn Gehrmann
    1. Federal Reform Commission II No access Björn Gehrmann
    2. Party Positions No access Björn Gehrmann
    3. Reform of Federal Political Geography No access Björn Gehrmann
    4. Reform of Municipal Political Geography No access Björn Gehrmann
    5. Alignment of Liability and Control No access Björn Gehrmann
  2. Björn Gehrmann
    1. Spatial Voting Models No access Björn Gehrmann
    2. The Political Economy of the Alignment of Liability and Control No access Björn Gehrmann
    3. The Political Economy of a Reform of Federal Geography No access Björn Gehrmann
    4. The Results of the Federal Reform Commission II No access Björn Gehrmann
  3. Interim Summary: Germany’s Agency Cost-Ineffective Federalism No access Pages 209 - 210 Björn Gehrmann
Concluding Remarks No access Pages 211 - 214 Björn Gehrmann
Literature No access Pages 215 - 225 Björn Gehrmann