Brown Bag Seminar: The excise curse: Italian municipalities and their fiscal revenues in the liberal era, 1858-1900

Abstract: Italian municipalities during the liberal era were responsible for essential public good provisions, such as primary education and basic healthcare. Many recent studies found that, in the absence of government direct intervention, available fiscal resources (fiscal capacity) were the main determinants of the quality and level of these services provided. This work extends the analysis to the fiscal policy mix behind those resources: first, we found that local excise taxes - the dazio consumo - played an extremely relevant role in revenue formation for large walled municipalities, in line with contemporary regulation. Second, we found considerable path dependence in the reliance of municipalities upon these taxes. Third, we found that those municipalities that extracted comparatively more revenues from excises were, overall, worse off in terms of overall revenues.