The Impact of Fiscal Decentralization on Growth, Inflation, and Inequality in the Americas
This paper analyzes the impact of fiscal decentralization on economic growth, the inflation rate, and the GINI coefficient in eleven American countries. The findings suggest that the expected positive impacts of this process have been modest, with revenue decentralization being more effective at preventing inflation, and expenditure decentralization showing greater tendency to positively influence growth. The flipside of these findings is that in the full sample of countries revenue decentralization deters growth while expenditure decentralization seems to foster inflation. With regards to the impact on the GINI coefficient, fiscal decentralization seems to be, at best, a marginal, negative influence on income distribution. The main recommendation is that American nations should pause and analyze the reasons why this process of fiscal devolution of responsibilities has not delivered on its promise of greater growth, price stability, and less income inequality.
|Date of creation:||Aug 2016|
|Contact details of provider:|| Postal: 206 Tilton Hall, New Orleans, LA 70118|
Phone: (504) 865-5321
Fax: (504) 865-5869
Web page: http://econ.tulane.edu
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Tarkan Cavusoglu & Oguzhan Dincer, 2015. "Does decentralization reduce income inequality? Only in rich states," Southern Economic Journal, Southern Economic Association, vol. 82(1), pages 285-306, July.
- Oates, Wallace E., 1993. "Fiscal Decentralization and Economic Development," National Tax Journal, National Tax Association, vol. 46(2), pages 237-43, June.
- Norman Gemmell & Richard Kneller & Ismael Sanz, 2013. "Fiscal Decentralization And Economic Growth: Spending Versus Revenue Decentralization," Economic Inquiry, Western Economic Association International, vol. 51(4), pages 1915-1931, October.
- Oates, Wallace E., 1993. "Fiscal Decentralization and Economic Development," National Tax Journal, National Tax Association, vol. 46(2), pages 237-243, June.
- Agnese Sacchi & Simone Salotti, 2014. "The Effects of Fiscal Decentralization on Household Income Inequality: Some Empirical Evidence," Spatial Economic Analysis, Taylor & Francis Journals, vol. 9(2), pages 202-222, June.
- Davoodi, Hamid & Zou, Heng-fu, 1998.
"Fiscal Decentralization and Economic Growth: A Cross-Country Study,"
Journal of Urban Economics,
Elsevier, vol. 43(2), pages 244-257, March.
- Hamid Davoodi & Heng-fu Zou, 1996. "Fiscal Decentralization and Economic Growth: A Cross-Country Study," CEMA Working Papers 98, China Economics and Management Academy, Central University of Finance and Economics.
- Neyapti, Bilin, 2010. "Fiscal decentralization and deficits: International evidence," European Journal of Political Economy, Elsevier, vol. 26(2), pages 155-166, June.
- Bilin Neyapti, 2003. "Fiscal Decentralisation and Deficits: International Evidence," Working Papers 2003/2, Turkish Economic Association.
- Bilin Neyapti, 2008. "Fiscal Decentralization and Deficits : International Evidence," Working Papers 0802, Department of Economics, Bilkent University.
- Zhang, Tao & Zou, Heng-fu, 1998. "Fiscal decentralization, public spending, and economic growth in China," Journal of Public Economics, Elsevier, vol. 67(2), pages 221-240, February.
- Tao Zhang & Heng-fu Zou, 1996. "Fiscal decentralization, public spending, and economic growth in China," Policy Research Working Paper Series 1608, The World Bank.
- Tao Zhang & Heng-fu Zou, 2001. "Fiscal decentralization, public spending, and economic growth in China," CEMA Working Papers 58, China Economics and Management Academy, Central University of Finance and Economics.
- Song, Yang, 2013. "Rising Chinese regional income inequality: The role of fiscal decentralization," China Economic Review, Elsevier, vol. 27(C), pages 294-309.
- Xie, Danyang & Zou, Heng-fu & Davoodi, Hamid, 1999. "Fiscal Decentralization and Economic Growth in the United States," Journal of Urban Economics, Elsevier, vol. 45(2), pages 228-239, March.
- Danyang Xie & Heng-fu Zou & Hamid Davoodi, 1999. "Fiscal Decentralization and Economic Growth in the United States," CEMA Working Papers 109, China Economics and Management Academy, Central University of Finance and Economics.
- Beramendi, Pablo, 2003. "Political institutions and income inequality: The case of decentralization," Discussion Papers, Research Unit: Institutions, States, Markets SP II 2003-09, Social Science Research Center Berlin (WZB).
- Francis Amagoh & Aloysius Ajab Amin, 2012. "An Examination of the Impacts of Fiscal Decentralization on Economic Growth," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 3(6), pages 72-81, November.
- Weingast, Barry R., 2009. "Second generation fiscal federalism: The implications of fiscal incentives," Journal of Urban Economics, Elsevier, vol. 65(3), pages 279-293, May.
- Thornton, John, 2007. "Fiscal decentralization and economic growth reconsidered," Journal of Urban Economics, Elsevier, vol. 61(1), pages 64-70, January.
- J Benson Durham, 1999. "Econometrics of Income Distribution: Toward More Comprehensive Specification of Institutional Correlates," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 41(1), pages 43-74, April. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:tul:wpaper:1610. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Rodrigo Aranda Balcazar)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.