000			01204pab a2200145 454500
008			180718b2015 xxu||||| |||| 00| 0 eng d
100			_aAllers, Maarten A.
245			_aThe Dutch local government bailout puzzle
260			_c2015
300			_ap.451-470.
520			_aThe fiscal federalism and public choice literatures stress that government bailouts should be ruled out as they increase the probability that jurisdictions will incur unsustainable debt levels or take excessive risk (moral hazard problem). The recent problems in the euro area seem to confirm this view. However, in the Netherlands, the law explicitly stipulates that local governments which are unable to balance their books will receive a bailout grant. Surprisingly, this does not seem to create problems. Few local governments apply for bailout, and the amounts they receive are modest. We analyse the Dutch case and investigate possible explanations for this apparent anomaly. Our results challenge the dominant view in the literature. It is possible to avoid fiscal irresponsibility by means other than a no-bailout policy. - Reproduced.
650			_aLocal government
773			_aPublic Administration
909			_a108770
999			_c108765 _d108765