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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 & Zafer Akin & Zeynep B. Cevik, 2011. "Does Fiscal Decentralization Promote Fiscal Discipline?," Working Papers 1101, 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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  6. Stephan Litschig, 2008. "Are rules-based government programs shielded from special-interest politics? Evidence from revenue-sharing transfers in Brazil," Economics Working Papers 1144, Department of Economics and Business, Universitat Pompeu Fabra, revised May 2012.
  7. Nina T Budina & Tidiane Kinda & Andrea Schaechter & Anke Weber, 2012. "Fiscal Rules at a Glance; Country Details from a New Dataset," IMF Working Papers 12/273, International Monetary Fund.
  8. Fisman, Raymond & Gatti, Roberta, 2002. "Decentralization and corruption: evidence across countries," Journal of Public Economics, Elsevier, vol. 83(3), pages 325-345, March.
  9. Adam, Antonis & Delis, Manthos D & Kammas, Pantelis, 2012. "Fiscal decentralization and public sector efficiency: Evidence from OECD countries," MPRA Paper 36889, University Library of Munich, Germany.
  10. 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.
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  12. Jorge Martínez-Vázquez & Robert M. McNab, "undated". "Fiscal Decentralization, Macrostability And Growth," Working Papers 11-03 Classification-JEL , Instituto de Estudios Fiscales.
  13. Bilin Neyapti, 2008. "Fiscal Decentralization and Deficits : International Evidence," Working Papers 0802, Department of Economics, Bilkent University.
  14. Tanzi, Vito, 2008. "The future of fiscal federalism," European Journal of Political Economy, Elsevier, vol. 24(3), pages 705-712, September.
  15. International Monetary Fund, 2011. "Measuring Fiscal Decentralization; Exploring the IMF’s Databases," IMF Working Papers 11/126, International Monetary Fund.
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  17. 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.
  18. 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.
  19. Sanguinetti, Pablo & Tommasi, Mariano, 2004. "Intergovernmental transfers and fiscal behavior insurance versus aggregate discipline," Journal of International Economics, Elsevier, vol. 62(1), pages 149-170, January.
  20. 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.
  21. 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.
  22. Anwar Shah, 2006. "A Practitioner´s Guide to Intergovernmental Fiscal Transfers," Revista de Economía y Estadística, Universidad Nacional de Córdoba, Facultad de Ciencias Económicas, Instituto de Economía y Finanzas, vol. 0(2), pages 128-186, July.
  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. 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.
  25. Neyapti, Bilin, 2004. "Fiscal decentralization, central bank independence and inflation: a panel investigation," Economics Letters, Elsevier, vol. 82(2), pages 227-230, February.
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