Rendas do Petróleo e Tributos Locais: Uma Análise de Propensity Score (Oil Windfalls and Local Tax in Brazil: A Propensity Score Analysis)

Posted: 17 Jul 2012

See all articles by Lauro Carnicelli

Lauro Carnicelli

University of Helsinki - Department of Political and Economic Studies

Fernando Postali

University of São Paulo (USP) - Department of Economics

Date Written: July 16, 2012

Abstract

With the pre-salt discoveries and the increasing distribution of royalties in Brazil, the discussions on the impact of oil windfalls - royalties and special participation - on benefited Municipalities have been intensified. This article aims to contribute to the understanding of the issue, using a methodology that allows building a counterfactual for municipalities treated with oil resources. The aim is to investigate whether these transfers reduce the own tax effort of cities covered by such revenues. For this, we applied the Double Robust method to a panel of municipalities observed from 2000 to 2009. The method consists of two stages. Firstly, it estimates the probability of receiving oil revenues conditioned to observable variables; in a second stage, a fixed-effect model was estimated with data belonging to a common support constructed through the estimated propensity scores in the first stage. The results show that there is a negative effect of royalties on fiscal effort of the cities benefited. However, this result does not occur when one computes the average effect on all cities.

Note: Downloadable document is in Portuguese.

Keywords: Propensity score, Double Robust, oil royalties, fiscal effort

JEL Classification: H77, C21

Suggested Citation

Carnicelli, Lauro and Postali, Fernando Antonio Slaibe, Rendas do Petróleo e Tributos Locais: Uma Análise de Propensity Score (Oil Windfalls and Local Tax in Brazil: A Propensity Score Analysis) (July 16, 2012). Available at SSRN: https://ssrn.com/abstract=2109577 or http://dx.doi.org/10.2139/ssrn.2109577

Lauro Carnicelli (Contact Author)

University of Helsinki - Department of Political and Economic Studies ( email )

P.O. Box 54
FIN-00014 Helsinki
Finland

Fernando Antonio Slaibe Postali

University of São Paulo (USP) - Department of Economics ( email )

Av. Prof. Luciano Gualberto 908
Sao Paulo SP, 05508-900
Brazil
+55 11 30915915 (Phone)
+55 11 30915915 (Fax)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
472
PlumX Metrics