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THE NET FISCAL IMPACT OF SELECTED FEDERAL BLOCK GRANT PROGRAMS *
Author(s) -
Strauss Robert P.,
Harkins Peter B.
Publication year - 1986
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/j.1467-9787.1986.tb00332.x
Subject(s) - subsidy , equity (law) , block grant , economics , index (typography) , fiscal year , public economics , demographic economics , actuarial science , finance , political science , world wide web , computer science , welfare , law , market economy
This paper examines the net fiscal benefits of various federal grants and taxes paid to finance them. Net, effective tax rates are calculated for all county areas in the U.S. for seven measured grant programs, and the distributions of such tax rates are examined in conjunction with the median family incomes of the county areas. Inferences about the progressivity (or regressivity) of the grant programs are made, as well as inferences about the horizontal equity of the grant programs through the use of a new class of index numbers. It was found that more progressive grant formulas, which provide greater rates of subsidy to areas with lower median family incomes, also tend to be less horizontally equitable.