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Public Choice

, Volume 175, Issue 1–2, pp 95–109 | Cite as

Self-imposition of public oversight

Article
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Abstract

We argue that policymakers may have personal interests in policy restraints channeled through public oversight. Self-imposition of public oversight can be beneficial for the policymaker because it may help alleviate the dynamic inconsistency problem that she otherwise faces. In the setting studied herein, self-imposed public oversight takes the form of a ceiling on tax rates, which can be overridden only with the legislature’s consent. Such a mechanism is shown to credibly commit the policymaker to future tax restraint, thus inducing larger productive effort.

Keywords

Legislative oversight Tax caps Dynamic inconsistency 

JEL Classification

D72 H11 

Notes

Acknowledgements

I am grateful to the referees and the editor for their very helpful comments.

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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Ben Gurion UniversityBeer ShevaIsrael
  2. 2.CEPRLondonUK
  3. 3.CESifoMunichGermany
  4. 4.IZABonnGermany

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