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A Presentation: The Economic Case For Fiscal Autonomy 19/04/2006



THE ECONOMIC CASE FOR SCOTTISH FISCAL AUTONOMY: WITH OR WITHOUT INDEPENDENCE

Ronald MacDonald and Paul Hallwood
University of Glasgow, UK, and University of Connecticut, USA

Wednesday April 19th, 1pm to 2.30pm

THE EVENT IS NOW FULL. FOR INFORMATION, PLEASE CONTACT: Elizabeth.Lloyd@scottish.parliament.uk

This paper contains a discussion of the tax, public spending and economic implications for Scotland of fiscal autonomy. Two types of fiscal autonomy are discussed.

It is argued that the current block grant system is inefficient because it does not require the Scottish Executive to balance the benefits of public spending against the pain of financing. The paper also postulates that with deficient incentives political decision-makers are unlikely to strive to increase efficiency in the provision of publicly provided goods, or to try to get the right balance between provision of goods and services by the Scottish public and private sectors, and nor to promote economic growth in Scotland.

This paper moves the debate forward considerably from the earlier paper from Prof MacDonald and Prof Hallwood and makes for compelling reading and lively debate.

Professor Ronald MacDonald currently holds the following positions: Adam Smith Professor of Political Economy, University of Glasgow; Research Fellow; CESifo Research Network, Munich; International Fellow Kiel Institute of World Economics.

He has acted as consultant to over 30 institutions, ranging from the International Monetary Fund, European Central Bank and Reserve Bank of New Zealand, numerous other central banks, the European Commission and many private sector financial institutions, such as Royal Bank of Scotland and Credit Suisse First Boston.

Ronald MacDonald has written extensively on Economics and, with Paul Hallwood, contributed to the 2004 Fraser of Allander Series of lectures.

Professor Paul Hallwood has published many books and peer-reviewed papers on diverse topics mainly in the area of international economic and financial organization. Before joining the University of Connectict he worked at the University of Aberdeen where, among other things, he wrote a seminal book on the economics of the offshore oil supply industry. He has also worked for several years as a consultant to a major Arab oil exporting country, and he has written on the political economy of the world oil industry. He has also acted as a consultant to local authorities in the USA.

The Policy Institute is happy to co-host this event (a) because we have published papers on fiscal autonomy in the past and (b) this is an important contribution to an important debate that we have been active in promoting (see Institute papers 'Paying Our Way', 'Taking Liberties', 'Restoring Liberties', Electing Local Heroes' 'Calling Scotland to Account' and 'What Future For Scotland', all available from this web site).

To all this Ronald Macdonald & Paul Hallwood now make a vital contribution that takes forward their previous position. While the trustees do not take a view either side of this argument - it was not commissioned, edited or refereed by the Institute - it is a splendid contribution to debate and we are happy to publish and post it on this site for 19th April (under Research & Publications).
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