Unconditional federal transfers and state government spending: The flypaper effect in Nigeria and South Africa
Abdurrahman Isik,
Peter D. Golit,
Paul Terhemba Iorember
Abstract:The flypaper effect is undoubtedly among the most interesting concepts in subnational government spending behavior. This study is the first attempt to provide empirical evidence on the existence of the flypaper effect in the two largest economies in Sub-Saharan Africa: Nigeria and South Africa. Using the two-step system generalized method of moment’s estimator, our results show that the flypaper effect exists for both state and provincial governments in Nigeria and South Africa. Provincial governments in South… Show more
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