Do Fiscal and Political Decentralization Raise Students' Performance? A Cross-Country Analysis

Luis Diaz-Serrano (luis.diaz@urv.cat) and Enric Meix-Llop

No 6722, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: The low quality of education is a persistent problem in many developed countries. Parallel to in the last decades exists a tendency towards decentralization in many developed and developing countries. Using micro data from the Programme for International Student Assessment (PISA) referred to 22 countries, we test whether there exists an impact of fiscal and political decentralization on student performance in the areas of mathematics, reading skills and science. We observe that fiscal decentralization exerts an unequivocal positive effect on students' outcomes in all areas, while the effect of political decentralization is more ambiguous. On the one hand, the capacity of the subnational governments to rule on its region has a positive effect on students' performance in mathematics. On the other hand, the capacity to influence the country as a whole has a negative impact on mathematics achievement. As a general result, we observe that students' performance in Mathematics is more sensible to these exogenous variations than in Sciences and reading skills.

Keywords: fiscal decentralization; PISA; school outcomes; political decentralization (search for similar items in EconPapers)
JEL-codes: H11 H77 I21 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2012-07
New Economics Papers: this item is included in nep-edu and nep-lab
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Citations: View citations in EconPapers (10)

Published - published as 'Decentralization and the Quality of Public Services: Cross-Country Evidence from Educational Data' in: Environment & Planning C: Politics and Space, 2019, 37 (7), 1296-1316

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