“…In particular, the emerging jurisdictional interaction is in line with a Tiebout sorting process, where cities compete with diverse factor package to attract an optimal amount of investments. Fukushige and Shi (2017) investigate intergovernmental fiscal relationships between the central government and provincial governments in China, with using non-symmetric Nash solution. They find that although an increase in either income inequality revenue or real per capita GDP lowers local governments' bargaining power with the budgetary system.…”