Fiscal decentralization and income (re)distribution in OECD countries' regions

Filomena Pietrovito (filomena.pietrovito@unimol.it), Alberto Pozzolo, Giuliano Resce (giuliano.resc@gmail.com) and Antonio Scialà (antonio.sciala@uniroma3.it)
Authors registered in the RePEc Author Service: Antonio Sciala'

Economics & Statistics Discussion Papers from University of Molise, Department of Economics

Abstract: Cross-country income inequality has declined in the last decades, but this trend has been paralleled by an increase in within-countries inequality. At the same time, many governments have implemented fiscal decentralization policies, devolving increasing decision-making powers on fiscal matters to sub-national levels of government. In this paper, we provide empirical evidence on the relationship between fiscal decentralization and intra-regional income redistribution, based on regional level data on inequality and government revenues for 187 regions of 15 OECD countries. Our results show that within region income redistribution is negatively associated with fiscal decentralization, especially when it takes the form of revenue decentralization.

Keywords: Fiscal Decentralization; Inequality; OECD Regions (search for similar items in EconPapers)
JEL-codes: H2 H7 R5 (search for similar items in EconPapers)
Pages: 26
Date: 2022-05-30
New Economics Papers: this item is included in nep-pbe and nep-ure
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Published in Structural Change and Economic Dynamics, 67, 69-81, https://doi.org/10.1016/j.strueco.2023.07.002

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Journal Article: Fiscal decentralization and income (re)distribution in OECD countries’ regions (2023)
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