EconPapers    
Economics at your fingertips  
 

Decentralization and Electoral Accountability: Incentives, Separation, and Voter Welfare

Jean Hindriks () and Ben Lockwood ()

No 269623, Economic Research Papers from University of Warwick - Department of Economics

Abstract: This paper studies the relationship between ¯scal decentralization and electoral accountability, by analyzing how decentralization impacts upon incentive and selection e®ects, and thus on voter welfare. The model abstracts from features such as public good spillovers or economies of scale, so that absent elections, voters are indi®erent about the ¯scal regime. The e®ect of ¯scal centralization on voter welfare works through two channels: (i) via its e®ect on the probability of pooling by the bad incumbent; (ii) conditional on the probability of pooling, the extent to which, with centralization, the incumbent can divert rents in some regions without this being detected by voters in other regions (selective rent diversion). Both these e®ects depend on the information structure; whether voters only observe ¯scal policy in their own region, in all regions, or an intermediate case with a uniform tax across all regions. More voter information does not necessarily raise voter welfare, and under some conditions, voter would choose uniform over di®erentiated taxes ex ante to constrain selective rent diversion.

Keywords: Financial Economics; Political Economy (search for similar items in EconPapers)
Date: 2005-03-03
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15) Track citations by RSS feed

Downloads: (external link)
http://ageconsearch.umn.edu/record/269623/files/twerp_729.pdf (application/pdf)
http://ageconsearch.umn.edu/record/269623/files/twerp_729.pdf?subformat=pdfa (application/pdf)

Related works:
Journal Article: Decentralization and electoral accountability: Incentives, separation and voter welfare (2009) Downloads
Working Paper: Decentralization and Electoral Accountability: Incentives, Separation, and Voter Welfare (2005) Downloads
Working Paper: Decentralization and electoral accountability: incentives, separation, and voter welfare (2005) Downloads
Working Paper: Decentralization and Electoral Accountability: Incentives, Separation and Voter Welfare (2005) Downloads
Working Paper: Decentralization and Electoral Accountability: Incentives, Separation and Vote Welfare (2005) Downloads
Working Paper: Decentralization and Electoral Accountability: Incentives, Separation, and Voter Welfare (2005) Downloads
Working Paper: Decentralization and Electoral Accountability: Incentives, Separation, and Voter Welfare (2005) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:uwarer:269623

Access Statistics for this paper

More papers in Economic Research Papers from University of Warwick - Department of Economics
Bibliographic data for series maintained by AgEcon Search ().

 
Page updated 2019-03-26
Handle: RePEc:ags:uwarer:269623