A Game-theory Analysis of the Spanish Regional Financing System

Authors

DOI:

https://doi.org/10.5477/cis/reis.166.85

Keywords:

Credibility, • Regional Governments, Fiscal Federalism, Soft Budget Constraint, Moral Hazard, Regional Financing System, Game Theory

Abstract

Recent history has shown the inherent instability of the Spanish Regional Financing System. This system is key to the design of a fiscal framework aimed at ensuring budgetary stability, debt sustainability and transparency. In this paper we examine issues related to moral hazard and deficit bias from a game theory perspective. We combine classical concepts from game theory (Nash equilibrium, subgame perfection) with concepts derived from refinements (theory of moves) aimed at introducing dynamic elements in the normal-form game, rendering it more suitable for the study of repeated, recurrent interactions.

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Published

2024-02-15

How to Cite

José Federico Geli, & Quilis, E. M. (2024). A Game-theory Analysis of the Spanish Regional Financing System. Revista Española De Investigaciones Sociológicas, (166), 85–106. https://doi.org/10.5477/cis/reis.166.85

Issue

No. 166 (2019)

Section

Articles

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Copyright (c) 2024 Revista Española de Investigaciones Sociológicas

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