The state of Junis wants to revamp its infrastructural facilities of bridges and underwater tunnels. Consequently, it invites highly competent international infrastructure development companies to pitch in with their bids. In order to attract them, Junis lowers its tax rates below the national taxation levels imposed on foreign investors. This scenario illustrates the model of _____.

Question

Quizplus · Accepted Answer

Competitive federalism is illustrated in this scenario, where the state of Junis competes with other states or national levels by offering lower tax rates to attract foreign investment for infrastructure development. This competition among different levels of government for resources or business is a hallmark of competitive federalism.

The State of Junis Wants to Revamp Its Infrastructural Facilities