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Decentralization and the Composition of Public Expenditure in Spain

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  • Juan Gonzalez Alegre

Abstract

Gonzalez Alegre J. Decentralization and the composition of public expenditure in Spain, Regional Studies. This paper examines the effects of fiscal decentralization on the economic distribution of public expenditures. Using panel data from the seventeen Spanish regions (1984-2003), it is shown that fiscal decentralization is a crucial determinant of the share of the public budget devoted to capital. The estimation run is based on a model in which the utility of the representative agent from the current public expenditure depends on the distance to the level of the administration that provides it. That could be the cause why decentralized economies experience a higher share of current expenditure in the budget of the public administrations. [image omitted] Gonzalez Alegre J. La decentralisation et la structure des depenses publiques en Espagne, Regional Studies. Cet article cherche a examiner l'impact de la fiscalite decentralisee sur la distribution economique des depenses publiques. A partir des donnees provenant d'une enquete a echantillon constant pour les dix-sept regions d'Espagne (de 1983 a 2003) on demontre que la fiscalite decentralisee s'avere un determinant cle de la part du budget de l'Etat affectee a l'investissement. La serie d'estimations est fondee sur un modele ou l'utilite des depenses publiques dont beneficie l'agent representatif depend de la distance du niveau d'administration qui les octroie. Il pourrait s'en averer que les economies decentralisees font preuve d'une part plus elevee des depenses courantes dans le budget de l'administration publique. Decentralisation fiscale Depenses publiques Capital de l'Etat Gonzalez Alegre J. Dezentralisierung und die Zusammensetzung der offentlichen Ausgaben in Spanien, Regional Studies. In diesem Beitrag untersuchen wir die Auswirkungen einer fiskalen Dezentralisierung auf die wirtschaftliche Verteilung offentlicher Ausgaben. Anhand der Paneldaten von den 17 spanischen Regionen (1984-2003) zeigen wir, dass die fiskale Dezentralisierung einen wesentlichen Determinanten des fur Kapital aufgewendeten Anteils des offentlichen Etats darstellt. Die Schatzungen basieren auf einem Modell, in dem der Nutzen des Vertreters der derzeitigen offentlichen Ausgaben von der Distanz zur Verwaltungsebene abhangt, die diese Ausgaben vornimmt. Dies konnte dazu fuhren, dass dezentralisierte Wirtschaften einen hoheren Anteil offentlicher Ausgaben im Etat der offentlichen Verwaltungen verzeichnen. Fiskale Dezentralisierung Offentliche Ausgaben Offentliches Kapital Gonzalez Alegre J. Descentralizacion y la composicion del gasto publico en Espana, Regional Studies. En este articulo analizamos los efectos de la descentralizacion fiscal en la distribucion economica del gasto publico. A partir de datos de panel de las diecisiete comunidades espanolas (1984-2003) mostramos que la descentralizacion fiscal es un determinante crucial de la participacion del presupuesto publico dedicado al capital. Las estimaciones se basan en un modelo en el que la utilidad del agente representativo del gasto publico actual depende de la distancia al nivel de la administracion que lo ofrece. Esto podria llevar a que las economias descentralizadas registren una participacion mas alta del gasto actual en el presupuesto de las administraciones publicas. Descentralizacion fiscal Gasto publico Capital publico

Suggested Citation

  • Juan Gonzalez Alegre, 2010. "Decentralization and the Composition of Public Expenditure in Spain," Regional Studies, Taylor & Francis Journals, vol. 44(8), pages 1067-1083.
  • Handle: RePEc:taf:regstd:v:44:y:2010:i:8:p:1067-1083
    DOI: 10.1080/00343400903365151
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    References listed on IDEAS

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    1. Oates, Wallace E., 1993. "Fiscal Decentralization and Economic Development," National Tax Journal, National Tax Association;National Tax Journal, vol. 46(2), pages 237-243, June.
    2. repec:spr:portec:v:1:y:2002:i:2:d:10.1007_s10258-002-0009-9 is not listed on IDEAS
    3. Sturm, Jan-Egbert, 2001. "Determinants of public capital spending in less-developed countries," CCSO Working Papers 200107, University of Groningen, CCSO Centre for Economic Research.
    4. Randolph, Susan*Bogetic, Zeljko*Hefley, Dennis, 1996. "Determinants of public expenditure on infrastructure : transportation and communication," Policy Research Working Paper Series 1661, The World Bank.
    5. Stephen Bond, 2002. "Dynamic panel data models: a guide to microdata methods and practice," CeMMAP working papers CWP09/02, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
    6. Oates, Wallace E., 1993. "Fiscal Decentralization and Economic Development," National Tax Journal, National Tax Association, vol. 46(2), pages 237-43, June.
    7. repec:dgr:rugccs:200107 is not listed on IDEAS
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    Citations

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    Cited by:

    1. Juan González Alegre, 2010. "Fiscal decentralization and intergovernmental grants: the European regional policy and Spanish autonomous regions," Working Papers 2010/6, Institut d'Economia de Barcelona (IEB).
    2. repec:jns:jbstat:v:237:y:2017:i:3:p:225-273:n:5 is not listed on IDEAS
    3. Stossberg Sibylle & Blöchliger Hansjörg, 2017. "Fiscal Decentralisation and Income Inequality: Empirical Evidence from OECD Countries," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 237(3), pages 225-273, June.
    4. repec:bla:kyklos:v:70:y:2017:i:2:p:189-219 is not listed on IDEAS
    5. Moussé Sow & Ivohasina F Razafimahefa, 2015. "Fiscal Decentralization and the Efficiency of Public Service Delivery," IMF Working Papers 15/59, International Monetary Fund.
    6. Juan González-Alegre, 2015. "Does fiscal decentralization affect the effectiveness of intergovernmental grants? European regional policy and Spanish autonomous regions," Papers in Regional Science, Wiley Blackwell, vol. 94(4), pages 817-847, November.
    7. Agnese Sacchi & Simone Salotti, 2016. "A Comprehensive Analysis of Expenditure Decentralization and of the Composition of Local Public Spending," Regional Studies, Taylor & Francis Journals, vol. 50(1), pages 93-109, January.
    8. repec:sgh:gosnar:y:2016:i:6:p:95-114 is not listed on IDEAS
    9. International Monetary Fund, 2015. "Romania; Selected Issues," IMF Staff Country Reports 15/80, International Monetary Fund.
    10. Sacchi, Agnese & Salotti, Simone, 2014. "The asymmetric nature of fiscal decentralization: theory and practice," MPRA Paper 54506, University Library of Munich, Germany.
    11. Arze del Granado, F. Javier & Martinez-Vazquez, Jorge & McNab, Robert M., 2012. "Decentralized Governance and Preferences for Public Goods," MPRA Paper 42459, University Library of Munich, Germany.

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