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Decentralization and the Productive Efficiency of Government: Evidence from Swiss Cantons

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Author Info
Iwan Barankay () (University of Warwick, CEPR and IZA Bonn)
Ben Lockwood () (University of Warwick and CEPR)

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Abstract

Advocates of fiscal decentralization argue that amongst other benefits, it can increase the efficiency of delivery of government services. This paper is one of the first to evaluate this claim empirically by looking at the association between expenditure decentralization and the productive efficiency of government using a data-set of Swiss cantons. We first provide careful evidence that expenditure decentralization is a powerful proxy for legal local autonomy. Further panel regressions of Swiss cantons provide robust evidence that more decentralization is associated with higher educational attainment. We also show that these gains lead to no adverse effects across education types but that male students benefited more from educational decentralization closing, for the Swiss case, the gender education gap.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2477.

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Length: 31 pages
Date of creation: Dec 2006
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Handle: RePEc:iza:izadps:dp2477

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Related research
Keywords: decentralization; productive efficiency; local public goods;

Other versions of this item:

Find related papers by JEL classification:
H40 - Public Economics - - Publicly Provided Goods - - - General
H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
I20 - Health, Education, and Welfare - - Education - - - General

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References listed on IDEAS
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Iwan Barankay & Ben Lockwood, 2006. "Decentralization and the Productive Efficiency of Government: Evidence from Swiss Cantons," IZA Discussion Papers 2477, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  2. Axel Dreher, 2006. "Power to the People? The Impact of Decentralization on Governance," KOF Working papers 06-121, KOF Swiss Economic Institute, ETH Zurich. [Downloadable!]
  3. Clément Carbonnier, 2008. "Fiscal competition between decentralized jurisdictions, theoretical and empirical evidence," THEMA Working Papers 2008-17, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise. [Downloadable!]
  4. Paula Salinas Pena & Albert Sole-Olle, 2009. "Evaluating the effects of decentralization on educational outcomes in Spain," Working Papers in Economics 228, Universitat de Barcelona. Espai de Recerca en Economia. [Downloadable!]
  5. Revelli Federico, 2008. "Spend more, get more? An inquiry into English local government performance," Department of Economics Working Papers 200804, University of Turin. [Downloadable!]
  6. Brosio, Giorgio & Zanola, Roberto, 2008. "The welfare costs of national standards: a contribution to the debate on the outcomes of de/centralization," P.O.L.I.S. department's Working Papers 113, Department of Public Policy and Public Choice - POLIS. [Downloadable!]
  7. Antonis Adam & Manthos D. Delis & Pantelis Kammas, 2008. "Fiscal Decentralization and Public Sector Efficiency: Evidence from OECD Countries," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  8. Sun Go & Peter H. Lindert, 2007. "The Curious Dawn of American Public Schools," NBER Working Papers 13335, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  9. Guccio, Calogero & Pignataro, Giacomo & Rizzo, Ilde, 2009. "The performance of local government in the execution of public works," MPRA Paper 16094, University Library of Munich, Germany. [Downloadable!]
  10. Giorgio Brosio & Ehtisham Ahmad & Vito Tanzi, 2008. "Local Service Provision in Selected OECD Countries: Do Decentralized Operations Work Better?," IMF Working Papers 08/67, International Monetary Fund. [Downloadable!]
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