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Revenue Autonomy and Regional Growth: An Analysis of the 25-Year Process of Fiscal Decentralisation in Spain

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  • Ramiro Gil-Serrate

    (CENTRUM Católica, Pontificia Universidad Católica del Perú, Santiago de Surco, Lima 33, Perú)

  • Julio López-Laborda

    (Departamento de Economía Aplicada, Universidad de Zaragoza, Gran Via 2, 50005 Zaragoza, Spain)

  • Jesús Mur

    (Departamento de Análisis Económico, Universidad de Zaragoza, Gran Via 2, 50005 Zaragoza, Spain)

Abstract

By estimating bivariate panel vector autoregressions, this paper analyses the relationship between the revenue autonomy of Spanish regional governments and the regional growth experienced in Spain during the process of fiscal decentralisation from 1984 to 2008. The key finding is the presence of a significant, but marginal, positive effect of regional governments' revenue autonomy on regional growth during the period considered. The small size of the effect can be attributed to the fact that Spanish regional governments have not made extensive use of their important regulatory powers acquired in the 1996 review of the regional financing system or, alternatively, to the fact that the policy of increasing revenue autonomy might have reached saturation point during the period studied, with regard to its effect on economic growth. Both arguments are supported by the identification of an apparent breakpoint, in 1999, in the relationship between revenue autonomy and regional growth in Spain.

Suggested Citation

  • Ramiro Gil-Serrate & Julio López-Laborda & Jesús Mur, 2011. "Revenue Autonomy and Regional Growth: An Analysis of the 25-Year Process of Fiscal Decentralisation in Spain," Environment and Planning A, , vol. 43(11), pages 2626-2648, November.
    • Handle: RePEc:sae:envira:v:43:y:2011:i:11:p:2626-2648
    DOI: 10.1068/a43352
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    References listed on IDEAS

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    Cited by:

    1. Angulo, Ana & Burridge, Peter & Mur, Jesús, 2018. "Testing for breaks in the weighting matrix," Regional Science and Urban Economics, Elsevier, vol. 68(C), pages 115-129.
    2. Alfonso Mendoza‐Velázquez & Mónica Rubio‐García & Luis D. Conde‐Cortés, 2022. "Fiscal decentralization and regional economic growth: Evidence from Mexico since the 2000s," Public Budgeting & Finance, Wiley Blackwell, vol. 42(1), pages 45-65, March.
    3. Santiago Lago-Peñas & Xoaquín Fernández-Leiceaga & Alberto Vaquero-García, 2017. "Spanish fiscal decentralization: A successful (but still unfinished) process," Environment and Planning C, , vol. 35(8), pages 1509-1525, December.
    4. Foreman-Peck, James & Zhou, Peng, 2016. "Migration and Tax Yields in a Devolved Economy," Cardiff Economics Working Papers E2016/7, Cardiff University, Cardiff Business School, Economics Section.
    5. Carlos Usabiaga & E. Macarena Hernández-Salmerón, 2016. "Regional Growth and Convergence in Spain: Is the Decentralization Model Important?," EcoMod2016 9358, EcoMod.

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