The Impact of Fiscal Decentralization: A Survey

Jorge Martinez-Vazquez (), Santiago Lago-Peñas and Agnese Sacchi

No 1505, Working Papers. Collection A: Public economics, governance and decentralization from Universidade de Vigo, GEN - Governance and Economics research Network

Abstract: In this paper we offer a comprehensive and updated review of the impact of fiscal decentralization on the economy, society and politics. We start with the examination of two crucial and yet unsolved issues in the literature on decentralization: its proper measurement and the potential endogeneity of fiscal decentralization with many of the variables of interest we are trying to investigate. Then we discuss the main findings in the existing literature on the effects of decentralization on a relevant list of socio-economic variables. The impact of fiscal decentralization reforms on political institutions is also considered. Complete answers to the many questions on the impact of fiscal decentralization are not likely to be certain but overall there are reasons to be optimistic about the overall positive impact of the decentralized systems that have been introduced all over the world in the past several decades. The survey offered in this paper by necessity has to be selective but it presents a balanced view of what is known and what is not yet known opening room for further research and practice on fiscal decentralization.

Keywords: Fiscal federalism; governance; political decentralization; sub-national governments; macroeconomic stability; economic growth; public policies; politics; corruption; regional disparities; inequality. (search for similar items in EconPapers)
JEL-codes: H70 H72 H77 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2015-06
New Economics Papers: this item is included in nep-pbe and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (30)

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http://infogen.webs.uvigo.es/WP/WP1505.pdf Revised version, 2016 (application/pdf)

Related works:
Journal Article: THE IMPACT OF FISCAL DECENTRALIZATION: A SURVEY (2017)
Working Paper: The Impact of Fiscal Decentralization: A Survey (2015)
Working Paper: The Impact of Fiscal Decentralization: A Survey (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:gov:wpaper:1505

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