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Distributive politics and decentralisation in Chile and Peru

Author

Listed:
  • Livert, Felipe

    (Department of Applied Economics, University of the Basque Country (UPV/EHU). Department of Political and Social Sciences, European University Institute)

  • Mogollón, Raymundo

    (Department of Economics, Universidad Nacional Agraria La Molina, Lima, Peru)

  • Herrera, Pablo

    (Department of Engineering, Universidad Diego Portales)

Abstract

The paper presents evidence that decentralisation increases partisan influence in the allocation of non-programmatic resources. The model employs a panel data and fixed effects analysis using data corresponding to intergovernmental transfers from the national level, passing through the regional level and earmarked for investment for local governments in Chile (2008-2018) and Peru (2004 - 2013). The results indicate political influence on the distribution of resources. The distribution of resources is used tactically in both countries in presidential election years. The implementation of laws increasing political decentralisation in Chile and Peru increased the political bias in resource distribution. The results have policy implications and provide a comparative perspective on the development of fiscal institutions in both countries. In a continental scenario, in which Latin American countries are undergoing a strong decentralisation process, it is suggested to advance in reforms that increase transparency, accountability and citizen participation. In addition, it is advisable to limit non-programmatic allocations and provide stability in the distribution of public resources.

Suggested Citation

  • Livert, Felipe & Mogollón, Raymundo & Herrera, Pablo, 2024. "Distributive politics and decentralisation in Chile and Peru," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 58, pages 91-111.
  • Handle: RePEc:ris:invreg:0522
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    More about this item

    Keywords

    Distributive politics; decentralisation; Pork barrel; Chile; Peru.;
    All these keywords.

    JEL classification:

    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean
    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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