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Can the economic impact of political decentralisation be measured?

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  • Ezcurra, Roberto
  • Rodríguez-Pose, Andrés

Abstract

This paper examines whether, given the increasing salience of subnational governments, political decentralisation has an impact on overall economic performance. It uses panel data analyses in order to determine the association between a number of the different indices of political decentralisation developed over the last decade and a half with two basic measures of economic performance: changes in aggregate GDP per head and the evolution of within-country territorial inequalities. The results highlight that, in the case of economic growth, the perception we may have of how political decentralisation affects economic performance is highly contingent on the index we use, with results ranging from a mildly positive to a neutral influence of political decentralisation on economic growth. For regional inequalities, political decentralisation seems to lead to a rise in disparities, regardless of how political decentralisation is measured.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 8211.

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Date of creation: Jan 2011
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Handle: RePEc:cpr:ceprdp:8211

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Keywords: economic growth; Europe; political decentralisation; regional disparities; regions;

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References

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Cited by:
  1. Peter Huber, 2013. "Labour Market Institutions and Regional Unemployment Disparities," WWWforEurope Working Papers series 29, WWWforEurope.
  2. Marina Grusevaja & Toralf Pusch, 2011. "How does Institutional Setting Affect the Impact of EU Structural Funds on Economic Cohesion? New Evidence from Central and Eastern Europe," IWH Discussion Papers 17, Halle Institute for Economic Research.

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