Ferraresi, MassimilianoMigali, GiuseppeNordi, FrancescaRizzo, Leonzio2017-06-222017-06-222016https://hdl.handle.net/2445/112794We investigate the existence of spatial interaction in spending decisions among Italian municipalities. We estimate a spatial autoregressive dynamic panel data model, using information on 5,564 Italian municipalities over the period 2001-2011, exploiting their border contiguity as a measure of spatial neighborhood. We find a positive effect of neighboring expenditures on total, capital and current expenditures of a given municipality. We do not find any evidence of yardstick competition when we take account of political effects, while we find a negative relationship between spatial interaction and the size of the municipality for current expenditure. Thus, we conclude that spillover effects drive the strategic interaction.27 p.application/pdfengcc-by-nc-nd, (c) Ferraresi et al., 2016http://creativecommons.org/licenses/by-nc-nd/3.0/es/Espais públicsModels economètricsItàliaPublic spacesEconometric modelsItalyinfo:eu-repo/semantics/workingPaperinfo:eu-repo/semantics/openAccess