On the Political Determinants of Intergovernmental Grants in Decentralized Countries: The Case of Spain

Pablo Simón, Santiago Lago-Peñas and Alberto Vaquero García

International Center for Public Policy Working Paper Series, at AYSPS, GSU from International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University

Abstract: This paper studies the effect of political variables on the gains obtained by Spanish regions in periodical bargaining of the intergovernmental financing agreements and on the regional distribution of discretional earmarked grants over the period 1987-2008. First, we find that the relationship between gains in transferred revenues and on regional public debt stocks depends on the period and the specific issues discussed in the corresponding negotiation, aside from political affinity. Second, we show that the most discretional program of earmarked grants is strongly driven by electoral strategy. National incumbents tend to allocate intergovernmental transfers where there are competitive regional elections. Moreover, we show that earmarked grants are allocated in those regions where the incumbent performs better in national elections and, especially, in those where there are more seats to be won. Hence we prove that both strategies are complementary rather than exclusive.

Keywords: Intergovernmental grants; party systems; elections; subcentral public debt. (search for similar items in EconPapers)
Pages: 24 pages
Date: 2012-09-19
New Economics Papers: this item is included in nep-cdm, nep-geo, nep-pbe and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Journal Article: On the Political Determinants of Intergovernmental Grants in Decentralized Countries: The Case of Spain (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:ays:ispwps:paper1230

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