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Decentralization and Development Outcomes: What Does the Empirical Literature Really Say?

Tristan Canare

Hacienda Pública Española / Review of Public Economics, 2021, vol. 237, issue 2, 111-151

Abstract: This article critically reviews the empirical literature on decentralization and its relationship with development outcomes. The analysis suggests that revenue decentralization and fscal independence, or the ability of local governments to raise their own revenue rather than relying on transfers from the national government, are the decentralization types most positively associated with development outcomes. Expenditure decentralization has no clear trend. In terms of development outcomes, most of the studies reviewed found evidence that good governance is positively associated with decentralization; but the evidence is mixed on economic growth. Some suggestions were also made for future decentralization studies

Keywords: Decentralization; Development; Literature Survey (search for similar items in EconPapers)
JEL-codes: H70 H77 I30 (search for similar items in EconPapers)
Date: 2021
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