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Fiscal and Political Decentralization and Government Quality

  • Andreas P. Kyriacoua


    (Departament d’Economia, Universitat de Girona)

  • Oriol Roca-Sagalésb

    (Departament d’Economia Aplicada, Universitat Autònoma de Barcelona)

In this paper we apply both cross-section and panel analysis to the relationship between fiscal and political decentralization and government quality. We find that fiscal decentralization has a positive impact. Moreover, political decentralization tends to reduce the positive impact of fiscal decentralization on the quality of government. This negative impact of political decentralization on government quality persists when controlling for the degree of democratic maturity of countries but disappears when controlling for the extent of experience with statehood or public administration. This suggests that it is more affordable, in terms of government quality, to combine fiscal and political decentralization in countries with a long history of statehood.

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Paper provided by International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University in its series International Center for Public Policy Working Paper Series, at AYSPS, GSU with number paper1005.

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Length: 33 pages
Date of creation: 01 Feb 2010
Date of revision:
Handle: RePEc:ays:ispwps:paper1005
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