Fiscal Decentralization: A Political Economy Perspective

Ben Lockwood

The Warwick Economics Research Paper Series (TWERPS) from University of Warwick, Department of Economics

Abstract: This paper surveys recent contributions to the study of fiscal decentralization which adopt a political economy approach. It is argued that this approach can capture, in a variety of formal models, the plausible and influential ideas (increasingly, supported by empirical evidence) that fiscal decentralization can lead to improved preference-matching and accountability of government. In particular, recent work on centralized provision of public good provision via bargaining in a legislature shows how centralization reduces preference-matching, and recent work using "electoral agency" models formalizes the accountability argument. These models also provide insights into when decentralization may fail to deliver these benefits.

Keywords: Fiscal decentralization; political economy; local public goods (search for similar items in EconPapers)
JEL-codes: H41 H70 H72 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2005
New Economics Papers: this item is included in nep-pbe, nep-pol and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (42)

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Working Paper: Fiscal Decentralization: A Political Economy Perspective (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:wrk:warwec:721

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