Fiscal Decentralization and Trust
Using data from U.S. states and various measures of decentralization, I investigate the relationship between fiscal decentralization and trust. I find that a one standard deviation increase in either revenue decentralization or expenditure decentralization causes the share of trusting people in a state to increase by almost 4 percentage points. A one standard deviation increase in the number of governments, however, causes trust to increase by almost 2.5 percentage points. The results are robust to endogeneity.
Volume (Year): 38 (2010)
Issue (Month): 2 (March)
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