Fiscal Federalism and Tax Equalization: The potential for progressive local taxes

We construct an empirically informed computational model of fiscal federalism, testing whether horizontal or vertical equalization can solve the fiscal externality problem in an environment in which heterogeneous agents can move and vote. The model expands on the literature by considering the case of progressive local taxation. Although the consequences of progressive taxation under fiscal federalism are well understood, they have not been studied in a context with tax equalization, despite widespread implementation. The model also expands on the literature by comparing the standard median voter model with a realistic alternative voting mechanism. We find that fiscal federalism with progressive taxation naturally leads to segregation as well as inefficient and inequitable public goods provision while the alternative voting mechanism generates more efficient, though less equitable, public goods provision. Equalization policy, under both types of voting, is largely undermined by micro-actors' choices. For this reason, the model also does not find the anticipated effects of vertical equalization discouraging public goods spending among wealthy jurisdictions and horizontal encouraging it among poor jurisdictions. Finally, we identify two optimal scenarios, superior to both complete centralization and complete devolution. These scenarios are not only Pareto optimal, but also conform to a Rawlsian view of justice, offering the best possible outcome for the worst-off. Despite offering the best possible outcomes, both scenarios still entail significant economic segregation and inequitable public goods provision. Under the optimal scenarios agents shift the bulk of revenue collection to the federal government, with few jurisdictions maintaining a small local tax.

Current state of evidence on 'off-label' therapeutic options for systemic lupus erythematosus, including biological immunosuppressive agents, in Germany, Austria and Switzerland--a consensus report

Systemic lupus erythematosus (SLE) can be a severe and potentially life-threatening disease that often represents a therapeutic challenge because of its heterogeneous organ manifestations. Only glucocorticoids, chloroquine and hydroxychloroquine, azathioprine, cyclophosphamide and very recently belimumab have been approved for SLE therapy in Germany, Austria and Switzerland. Dependence on glucocorticoids and resistance to the approved therapeutic agents, as well as substantial toxicity, are frequent. Therefore, treatment considerations will include 'off-label' use of medication approved for other indications. In this consensus approach, an effort has been undertaken to delineate the limits of the current evidence on therapeutic options for SLE organ disease, and to agree on common practice. This has been based on the best available evidence obtained by a rigorous literature review and the authors' own experience with available drugs derived under very similar health care conditions. Preparation of this consensus document included an initial meeting to agree upon the core agenda, a systematic literature review with subsequent formulation of a consensus and determination of the evidence level followed by collecting the level of agreement from the panel members. In addition to overarching principles, the panel have focused on the treatment of major SLE organ manifestations (lupus nephritis, arthritis, lung disease, neuropsychiatric and haematological manifestations, antiphospholipid syndrome and serositis). This consensus report is intended to support clinicians involved in the care of patients with difficult courses of SLE not responding to standard therapies by providing up-to-date information on the best available evidence.