Heterogeneous Fiscal Decentralisation in Italian Regions

The fiscal decentralisation process in Italy is marked by persistent asymmetries between special statute regions and ordinary statute regions, reflecting historical, geographical, and economic differences. In this paper, we examine the countryÕs multi-level governance structure of fiscal decentralisation using the new OECDÕs REGOFI and MUNIFI datasets in combination with official statistical sources. The analysis confirms that special statute regions exhibit greater fiscal autonomy and lower dependence on central transfers than ordinary regions. At the municipal level, however, the pattern reverses. Municipalities in ordinary regions are demonstrating greater fiscal autonomy. The north-south development gap exacerbates these asymmetries further, with richer regions showing higher revenue autonomy. Recent advocacy for greater regional autonomy risks intensifying such territorial divides and disparities, potentially leading to congestion and under-provision of basic and essential public services. Our findings contribute to the broader literature on fiscal decentralisation by providing valuable insights for policy interventions aimed at adopting a balanced approach that addresses the existing asymmetries, promoting regional cohesion and ensuring equitable service provision in Italy.