TY - JOUR AU - Calabrese, Stephen AU - Epple, Dennis AU - Romano, Richard TI - Majority Choice of Taxation and Redistribution in a Federation JF - National Bureau of Economic Research Working Paper Series VL - No. 25099 PY - 2018 Y2 - September 2018 DO - 10.3386/w25099 UR - http://www.nber.org/papers/w25099 L1 - http://www.nber.org/papers/w25099.pdf N1 - Author contact info: Stephen Calabrese Tepper School of Business Carnegie Mellon University Posner Hall, Room 243 Pittsburgh, PA 15213 Tel: 813-974-0656 Fax: 813-974-0832 E-Mail: sc45@qatar.cmu.edu Dennis N. Epple Carnegie Mellon University Tepper School of Business Room 4126 Pittsburgh, PA 15213 Tel: 412/268-1536 E-Mail: epple@cmu.edu Richard Romano University of Florida Department of Economics PO Box 117140 Gainesville, FL 32611 E-Mail: romanor@ufl.edu AB - We provide a model with a federal government and multiple local governments, the former with power to levy an income tax for redistribution, and the latter choosing a local income tax, property tax, lump-sum tax or subsidy, and a local public good. Policy is set by majority choice at each tier of government by households that differ by income and ability to move across communities. We provide sufficient conditions for existence of equilibrium and examine its properties. Central findings are federal income distribution, little local redistribution, and local preference for property taxation over income taxation to fund local public goods. ER -