Public Finance Without Taxation: Alternative Institutional Frameworks for Municipal Corporations

29 Pages Posted: 4 Apr 2011

See all articles by Richard E. Wagner

Richard E. Wagner

George Mason University - Department of Economics; George Mason University - Mercatus Center

Date Written: April 2, 2011

Abstract

Expositions of the theory of public finance mostly presume that taxation will be the primary instrument for generating revenues. While this presumption is historically accurate, it does not so much reflect historical necessity as it reflects a combination of power and ideology. Cities are corporate bodies which can be organized under diverse institutional arrangements, only a subset of which will give scope to taxation rather than pricing through contract. For instance, there is a deep similarity between cities and such entities as hotels and malls with respect to the types of services they supply, along with a difference in structures of ownership and forms of revenue. Taxation is thus a feature of a particular arrangement of ownership that is potentially subject to variation; taxation is not something that is inherent in the provision of public goods because hotels and malls both illustrate the supply of public goods through contractual processes.

Keywords: cameralism, public pricing for public goods, municipal corporations, city states, political entrepreneurship, user charges and fees

JEL Classification: D23, D73, H11, R51

Suggested Citation

Wagner, Richard E., Public Finance Without Taxation: Alternative Institutional Frameworks for Municipal Corporations (April 2, 2011). GMU Working Paper in Economics No. 11-18, Available at SSRN: https://ssrn.com/abstract=1801548 or http://dx.doi.org/10.2139/ssrn.1801548

Richard E. Wagner (Contact Author)

George Mason University - Department of Economics ( email )

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HOME PAGE: http://mason.gmu.edu/~rwagner/

George Mason University - Mercatus Center ( email )

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Arlington, VA 22201
United States

HOME PAGE: http://ppe.mercatus.org/scholars/richard-wagner

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