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Do Fiscal and Political Decentralization Raise Students’ Performance? A Cross-Country Analysis

  • Díaz Serrano, Lluís
  • Meix Llop, Enric

The low quality of education is a persistent problem in many developed countries. Parallel to in the last decades exists a tendency towards decentralization in many developed and developing countries. Using micro data from the Programme for International Student Assessment (PISA) referred to 22 countries, we test whether there exists an impact of fiscal and political decentralization on student performance in the areas of mathematics, reading skills and science. We observe that fiscal decentralization exerts an unequivocal positive effect on students’ outcomes in all areas, while the effect of political decentralization is more ambiguous. On the one hand, the capacity of the subnational governments to rule on its region has a positive effect on students’ performance in mathematics. On the other hand, the capacity to influence the country as a whole has a negative impact on mathematics achievement. As a general result, we observe that students’ performance in Mathematics is more sensible to these exogenous variations than in Sciences and reading skills. Keywords: School outcomes, PISA, fiscal decentralization, political decentralization JEL codes: H11, H77, I21

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Paper provided by Universitat Rovira i Virgili, Department of Economics in its series Working Papers with number 2072/203156.

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Date of creation: 2012
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Handle: RePEc:urv:wpaper:2072/203156
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  1. Thomas Fuchs & Ludger Wößmann, 2007. "What accounts for international differences in student performance? A re-examination using PISA data," Empirical Economics, Springer, vol. 32(2), pages 433-464, May.
  2. Thomas Fuchs & Ludger Woessmann, 2004. "Computers and Student Learning: Bivariate and Multivariate Evidence on the Availability and Use of Computers at Home and at School," CESifo Working Paper Series 1321, CESifo Group Munich.
  3. Josep Lluís Carrion-i-Silvestre & Marta Espasa & Toni Mora, 2008. "Fiscal Decentralization and Economic Growth in Spain," Public Finance Review, , vol. 36(2), pages 194-218, March.
  4. Petra E. Todd & Kenneth I. Wolpin, 2003. "On The Specification and Estimation of The Production Function for Cognitive Achievement," Economic Journal, Royal Economic Society, vol. 113(485), pages F3-F33, February.
  5. Winkler, Donald R., 1989. "Decentralization in education : an economic perspective," Policy Research Working Paper Series 143, The World Bank.
  6. Hanushek, Eric A., 2006. "School Resources," Handbook of the Economics of Education, Elsevier.
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