Abstract

FLORES ARAUJO, Alberto Damián; SAENZ VELA, Hada Melissa  and  SANCHEZ-JUAREZ, Isaac. The “Flypaper Effect” and the Determinants of State Public Spending in México 1993-2016. Econ: teor. práct [online]. 2020, n.53, pp.177-199.  Epub Nov 12, 2020. ISSN 2448-7481.  https://doi.org/10.24275/etypuam/ne/532020/flores.

This paper was elaborated with the objective of presenting the results of estimating the "flypaper effect". For this, information was used from 31 Mexican states from the 1993-2016 period, which was grouped into a panel and from there, estimates were made using the generalized least squares technique. It was possible to verify that the elasticity of the state public expenditure in relation to the intergovernmental transfers was greater than that of the expenditure in relation to the own income. Additionally, it was confirmed that there was an asymmetry of the intergovernmental transfers, that the degree of marginalization was a determinant of public expenditure, as well as public debt and investment. As an additional contribution, the effect for the northern border and southern regions was estimated, concluding that the latter was more dependent on the intergovernmental transfers. The findings support the debate regarding the need to modify the current federal fiscal pact.

Keywords : Intergovernmental transfers; asymmetry; fiscal laziness; federalism; public finance; H72; H77; R51.

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