Sub-national fiscal autonomy, infrastructure investment and regional disparities

Paul Van Rompuy

No 584998, Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven

Abstract: This paper focusses on the relationship between subnational fiscal autonomy, transport infrastructure investment and regional disparities in 30 OECD countries over the period 1995-2011. Subnational fiscal autonomy is approximated by the revenue share of autonomous taxes. A fixed effects panel estimation reveals that SNG tax autonomy significantly contributes to regional convergence although its impact is small when compared to the effect of transport infrastructure investment. Subnational expenditure on education and economic affairs does not impact spatial disparities.

Date: 2017
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Published in Discussion paper series, DPS17.07 pages:1-24

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Persistent link: https://EconPapers.repec.org/RePEc:ete:ceswps:584998

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