The structure German fiscal federalism is subject of the study. It describes the extent to which the concept of federal competition can be implemented in a system that up to has had a largely co-operative orientation. The study examines both the relationship between the federal government and the Länder and that of the Länder among themselves. It looks especially at the economic conditions that must be fulfilled so that federal competition does not lead to a permanent widening of the gap between Länder. The study examines the fiscal equalisation system, the current division of responsibilities among the federal, Länder and municipal levels as well as the prospects for an independent tax policy of the Länder. The analysis is based on the theory of fiscal federalism, on the experience of other federal systems (USA, Canada, Switzerland) as well as on empirical analyses (regressions of panel data, descriptive evaluations, etc.).
This study was conducted by the departments of Public Finance and of Economic Forecasting and Financial Markets in collaboration with Prof. Bernd Huber of the Ludwig Maximillian University of Munich and completed in July 2001.
Chancen und Grenzen föderalen Wettbewerbs von Christian Baretti, Robert Fenge, Bernd Huber, Willi Leibfritz, Matthias Steinherr ifo Beiträge zur Wirtschaftsforschung Band 1 München: ifo Institut für Wirtschaftsforschung, 2000; 232 S.; 25,- EUR. ISBN 3-88512-378-9
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