An analysis of local sales taxation: The case of Louisiana
Description
The local sales tax is a widely utilized measure by which sub-state level governmental jurisdictions in the United States raise revenues. Despite the wide usage of this tax, its importance as a revenue source, and the long period of time for which it has been utilized, there has not been a great deal of attention paid to it. Our goal in this analysis is to add to this body of analysis in several specific ways This first of these is to bring empirical methodologies to bear on the problem which have been developed in the period since many of the issues specific to local sales taxation were first addressed. These more advanced techniques may call into question results which have been accepted in the literature for many years. The second advance of this work is also empirical in nature. Our data set is larger and more complete than many used in the past. Again, we are curious to see if previous results are robust to improved data The third major addition to the local public finance literature brought about by this work is theoretical in nature. We introduce a theoretical model of intra-regional competition. That is, we look at the inter-actions between political jurisdictions which share common physical boundaries. This approach is unique in the literature, and we develop results which may alter some commonly held suppositions about public goods provision at the local level