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Do Central Grants Affect Welfare Caseloads? Evidence from Public Assistance in Japan

Masayoshi Hayashi

No CIRJE-F-1064, CIRJE F-Series from CIRJE, Faculty of Economics, University of Tokyo

Abstract: This study examines the existence of a “loosening effect†on a local social policy of central funding by exploiting a specific mechanism in the Japanese system of central grants and two institutional changes in categorical grants for local social assistance programs. Despite performing various types of estimations, we fail to substantiate the existence of the loosening effect. This result indicates the dominance of central control over local discretion in public assistance programs, and suggests that important factors are administrative rather than fiscal.

Pages: 44 pages
Date: 2017-09
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