EconPapers    
Economics at your fingertips  
 

Decentralization and Electoral Accountability: Incentives, Separation and Vote Welfare

Jean Hindriks () and Ben Lockwood ()

No 2005038, Discussion Papers (ECON - Département des Sciences Economiques) from Université catholique de Louvain, Département des Sciences Economiques

Abstract: This paper studies the relationship between fiscal decentralization and electoral accountability, by analyzing how decentralization impacts upon incentive and selecion effects, and thus on voter welfare. The model abstracts from features such as public good spillovers or economics of scale, so that absent elections, voters are indifferent about the fiscal regime. The effect of fiscal centralization on voter welfare works through two channels : (i) via its effect 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 effects depend on the information structure; whether voters only observe fiscal 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 differentiated taxes ex ante to constrain selective rent diversion

Keywords: Fiscal federalism; decentralization; elections; accountability (search for similar items in EconPapers)
JEL-codes: D72 D73 H41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cdm, nep-pbe and nep-pol
Date: 2005-03-01, Revised 2005-03-15
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (7) Track citations by RSS feed

Downloads: (external link)
http://sites.uclouvain.be/econ/DP/IRES/2005-38.pdf (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 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:ctl:louvec:2005038

Access Statistics for this paper

More papers in Discussion Papers (ECON - Département des Sciences Economiques) from Université catholique de Louvain, Département des Sciences Economiques Place Montesquieu 3, 1348 Louvain-la-Neuve (Belgium). Contact information at EDIRC.
Bibliographic data for series maintained by Virginie LEBLANC ().

 
Page updated 2018-12-12
Handle: RePEc:ctl:louvec:2005038