The welfare costs of national standards: a contribution to the debate on the outcomes of de/centralization
This paper analyzes the welfare losses deriving from centralized, uniform levels of public provision of good and services deriving from standards set up by a given level of government. The aim of the paper is to contribute to the growing literature on the e?ective outcomes of decentralization by looking at the other side of the coin, namely at the impact of centralized provision. It develops a simple theoretical model and tests it with reference to public health care provision in Italy. The evidence shows that, while levels of satisfaction increase with income, which is a standard result of the theory, they are lower in the poorer regions where, due to the standards, the share of income absorbed by health care is substantially higher than in the richer regions.
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CEPR Discussion Papers
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