Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. We develop a simple model of fiscal competition among ageing municipalities. When ageing advances, gerontocracies and social planners gradually substitute publicly provided goods aimed at the mobile young population for publicly provided goods for the elderly. This substitution process does not only depend on the ageing itself but also on crowding effects and on the regional distribution of the elderly population. We show that fiscal competition prevents the exploitation of the young. When the share of the elderly is sufficiently large, the utility of the young is even higher in gerontocracies than in welfare maximizing societies. Due to fiscal competition, the gerontocracies will provide even more of the publicly provided good for the young than the social planner. Terms of use: Documents in EconStor mayJEL Code: H4, H7.

We analyze the efficiency of the municipal provision of child care and identify the main determinants of inefficiency. A unique data set on child-care expenditures and school readiness in the eastern German state of Saxony allows us to control for possible differences in quality across municipalities. First, we measure the efficiency using data envelopment analysis. We find substantial efficiency differences; the median municipality is up to 28% inefficient. Second, we identify the determinants of inefficiency in a bootstrapped truncated regression. Explanatory variables, such as an uncompensated mayor or a larger share of over-65-year-olds, significantly increase inefficiency.

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