Fiscal Decentralisation, Chinese Style: Good for Health Outcomes?
AbstractThis paper analyses the effect of fiscal decentralisation on health outcomes in China using a panel data set with nationwide county-level data. We find that counties in more fiscally decentralised provinces have lower infant mortality rates than counties where the provincial government remains the main spending authority, if certain conditions are met. Spending responsibilities at the local level need to be matched with county governments’ own fiscal capacity. For county governments that have only limited revenues, the ability to spend on local public goods such as health care depends crucially upon intergovernmental transfers. The findings of this paper, therefore, support the common assertion that fiscal decentralisation can lead to more efficient production of local public goods, while also highlighting the conditions required for this result to be obtained. Ce papier analyse l’effet de la décentralisation fiscale sur la santé en Chine, à partir d’une analyse de panel avec des données de district recueilli au niveau national. Les auteurs trouvent que, sous certaines conditions, les districts aux systèmes plus décentralisés ont des taux de mortalité infantiles moins élevés que ceux où le gouvernement provincial reste la principale autorité. Les responsabilités pour les dépenses au niveau local doivent toutefois être accompagnées de capacités fiscales adéquates. Pour les gouvernements de districts à bas revenus, la capacité à investir dans des biens publics comme les services de santé, dépend principalement des transferts intergouvernementaux. Les analyses confirment l’argument selon lequel la décentralisation fiscale peut mener à une plus grande efficacité des biens publics, en soulignant les conditions nécessaires pour atteindre ce résultat.
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Bibliographic InfoPaper provided by OECD Publishing in its series OECD Development Centre Working Papers with number 264.
Date of creation: Nov 2007
Date of revision:
health; health-care finance; fiscal decentralisation; China; santé; décentralisation fiscale; Chine; financement des services de santé;
Other versions of this item:
- Uchimura, Hiroko & Jütting, Johannes P., 2009. "Fiscal Decentralization, Chinese Style: Good for Health Outcomes?," World Development, Elsevier, vol. 37(12), pages 1926-1934, December.
- Jütting, Johannes P. & Uchimura, Hiroko, 2007. "Fiscal Decentralization, Chinese Style: Good for Health Outcomes?," Proceedings of the German Development Economics Conference, GÃ¶ttingen 2007 16, Verein für Socialpolitik, Research Committee Development Economics.
- H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
- H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
- H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-01-05 (All new papers)
- NEP-CNA-2008-01-05 (China)
- NEP-DEV-2008-01-05 (Development)
- NEP-PBE-2008-01-05 (Public Economics)
- NEP-TRA-2008-01-05 (Transition Economics)
- NEP-URE-2008-01-05 (Urban & Real Estate Economics)
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