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Fiscal decentralization, fiscal rules and fiscal discipline

Listed author(s):
  • Neyapti, Bilin

Fiscal decentralization (FD) and fiscal rules (FR) are institutional mechanisms that are implemented by varying degrees in increasing number of countries. This paper investigates empirically the effect of FR on the effectiveness of FD in achieving fiscal discipline. Panel evidence strongly supports that balanced budget and expenditure rules help FD to achieve this goal, while debt rule has a direct disciplinary effect.

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File URL: http://www.sciencedirect.com/science/article/pii/S0165176513004539
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Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 121 (2013)
Issue (Month): 3 ()
Pages: 528-532

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Handle: RePEc:eee:ecolet:v:121:y:2013:i:3:p:528-532
DOI: 10.1016/j.econlet.2013.10.006
Contact details of provider: Web page: http://www.elsevier.com/locate/ecolet

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  1. Bilin Neyapti, 2008. "Fiscal Decentralization and Deficits : International Evidence," Working Papers 0802, Department of Economics, Bilkent University.
  2. Jing Jin & Heng-fu Zou, 2000. "How does fiscal decentralization affect aggregate, national, and subnational government size?," CEMA Working Papers 72, China Economics and Management Academy, Central University of Finance and Economics.
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  8. Alberto Alesina & Tamim Bayoumi, 1996. "The Costs and Benefits of Fiscal Rules: Evidence from U.S. States," NBER Working Papers 5614, National Bureau of Economic Research, Inc.
  9. Fisman, Raymond & Gatti, Roberta, 2000. "Decentralization and corruption - evidence across countries," Policy Research Working Paper Series 2290, The World Bank.
  10. International Monetary Fund, 2011. "Measuring Fiscal Decentralization; Exploring the IMF’s Databases," IMF Working Papers 11/126, .
  11. Neyapti, Bilin, 2004. "Fiscal decentralization, central bank independence and inflation: a panel investigation," Economics Letters, Elsevier, vol. 82(2), pages 227-230, February.
  12. Zhang, Xiaobo, 2006. "Fiscal decentralization and political centralization in China: Implications for growth and inequality," Journal of Comparative Economics, Elsevier, vol. 34(4), pages 713-726, December.
  13. Jorge Martinez-Vazquez & Andrey Timofeev, 2009. "Decentralization Measures Revisited," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper0913, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
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  16. Bilin Neyapti & Zafer Akin & Zeynep B. Cevik, 2011. "Does Fiscal Decentralization Promote Fiscal Discipline?," Working Papers 1101, Department of Economics, Bilkent University.
  17. Laurent Bouton & Marjorie Gassner & Vincenzo Verardi, 2008. "Redistributing income under fiscal vertical imbalance," ULB Institutional Repository 2013/9905, ULB -- Universite Libre de Bruxelles.
  18. Andreas Kyriacou & Oriol Roca sagalés, 2009. "Fiscal descentralization and the quality of government: evidence from panel data," Hacienda Pública Española, IEF, vol. 189(2), pages 131-155, June.
  19. King, David & Ma, Yue, 2001. "Fiscal decentralization, central bank independence, and inflation," Economics Letters, Elsevier, vol. 72(1), pages 95-98, July.
  20. Mariano Tommasi & Pablo Sanguinetti, 2003. "Intergovernmental Transfers and Fiscal Behavior: Insurance versus Aggregate Discipline," Working Papers 60, Universidad de San Andres, Departamento de Economia, revised Aug 2003.
  21. Sven Stö & Christian Traxler, 2005. "Tax Evasion and Auditing in a Federal Economy," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 12(4), pages 515-531, August.
  22. Ulrich Thießen, 2003. "Fiscal Decentralisation and Economic Growth in High-Income OECD Countries," Fiscal Studies, Institute for Fiscal Studies, vol. 24(3), pages 237-274, September.
  23. Tanzi, Vito, 2008. "The future of fiscal federalism," Discussion Papers, Research Unit: Market Processes and Governance SP II 2008-03, Social Science Research Center Berlin (WZB).
  24. de Mello, Luiz Jr, 2000. "Fiscal Decentralization and Intergovernmental Fiscal Relations: A Cross-Country Analysis," World Development, Elsevier, vol. 28(2), pages 365-380, February.
  25. Tanzi, Vito, 2008. "The future of fiscal federalism," European Journal of Political Economy, Elsevier, vol. 24(3), pages 705-712, September.
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