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Decentralization in Developing Economies

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  • Lucie Gadenne
  • Monica Singhal

Abstract

Standard models of fiscal federalism suggest many benefits of decentralization in developing economies, and there has been a recent push toward decentralization around the world. However, developing countries presently still have less decentralization, particularly on the revenue side, than both developed countries today and the United States and Europe historically. We consider how the trade-offs associated with fiscal federalism apply in developing countries and discuss reasons for their relatively low levels of decentralization. We also consider additional features relevant to federalism in developing economies, such as the prevalence of nongovernmental organizations and the role of social incentives in policy design.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19402.

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Date of creation: Sep 2013
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Handle: RePEc:nbr:nberwo:19402

Note: DEV PE POL
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Cited by:
  1. Kis-Katos, Krisztina & Sjahrir, Bambang Suharnoko, 2014. "The Impact of Fiscal and Political Decentralization on Local Public Investments in Indonesia," IZA Discussion Papers 7884, Institute for the Study of Labor (IZA).

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