Question

The use of national monetary incentives to encourage and influence policies at the state and local levels is called ______.

Answer 1

Answer:

The use of national monetary incentives to encourage and influence policies at the state and local levels is called fiscal federalism.

Explanation:

While administrative federalism is the process in which the national government expects the state governments to pay for their programs without national aid, fiscal federalism is the financial incentive offered by the national government to encourage policies at the state and local levels. Economist apply the term fiscal federalism when more than one type of government - national, state, and local - is involved in public financing.