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Interjurisdiction Political Competition and Fiscal Extraction in China

Bibliographic Data

ID3549099
AuthorsXiaobo Lü (0000-0002-1702-985X), Pierre F Landry (0000-0003-4084-9503, University of Pittsburgh, corresponding author)
Year2014
Volume108
Issue3
Pages706-722
Publication date2014-08-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueAmerican Political Science Review (JOURNAL)
Journal identifiersISSN: 0003-0554 • E-ISSN: 1537-5943
PublisherCambridge University Press (CUP) (PUBLISHER)
DOI10.1017/s0003055414000252
OpenAlexW3124692104
LanguageEN
Citations received114
References cited65

We argue that interjurisdiction competition in authoritarian regimes engenders a specific logic for taxation. Promotion-seeking local officials are incentivized to signal loyalty and competence to their principals through tangible fiscal revenues. The greater the number of officials accountable to the same principal, the more intense political competition is, resulting in higher taxation; however, too many officials accountable to the same principal leads to lower taxation due to shirking by uncompetitive officials and the fear of political instability. Using a panel dataset of all Chinese county-level jurisdictions from 1999-2006, we find strong evidence for an inverse U-shaped relationship between the number of county-level jurisdictions within a prefecture-our proxy for the intensity of political competition-and fiscal revenues in most provinces but not so in politically unstable ethnic minority regions. The results are robust to various alternative specifications, including models that account for heterogeneous county characteristics and spatial interdependence

Authoritarianism · China · Competition (biology · Democracy · Economics · Loyalty · Political economy · Political science · Politics · Proxy (statistics · Revenue · China's Socioeconomic Reforms and Governance · Electoral Systems and Political Participation · Finance · Local Government Finance and Decentralization

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Unique citing works114
Citations per year9,5
Citation span2014 - 2026 (13)
Citation velocitycurrent
Highly citedYes
Citation typesNeutral: 113

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