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PRESSURE GROUPS AND PUBLIC EXPENDITURES: THE FLYPAPER EFFECT RECONSIDERED
Author(s) -
DOUGAN WILLIAM R.,
KENYON DAPHNE A.
Publication year - 1988
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.1988.tb01676.x
Subject(s) - economics , voter model , public economics , local government , political science , public administration , statistical physics , physics
A model of government budgeting is developed in which lobbying by interest groups can divert the allocation of funds away from the one preferred by the median voter. The model is applied to state and local governments to show that the “flypaper effect”–the tendency for lump‐sum grants to increase public expenditures by more than an equivalent increase in the community's pretax income–can be explained without the customary assumption of voter fiscal illusion. Furthermore, the model predicts variation in the extent of the flypaper effect among expenditure categories, as found in previous empirical studies.