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Is fiscal decentralization good for your health? Evidence from a panel of OECD countries

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  • Jiménez-Rubio, D

Abstract

In this study I use improved data of fiscal decentralization to re-examine the hypothesis that shifts towards more fiscal decentralization would be accompanied by improvements in population health on a panel of 19 OECD countries. The advantage of the new measure of decentralization is that it reflects better than previous measures the existence of autonomy in the decision making authority of lower tiers of government, a crucial issue in the decentralization process. The results based on panel data estimation techniques robust to heteroskedasticity and autocorrelation show that fiscal decentralization has a substantial and positive effect on health outcomes over the period studied. However, I find that conventional measures of decentralization tend to over-estimate the magnitude of the effect.

Suggested Citation

  • Jiménez-Rubio, D, 2010. "Is fiscal decentralization good for your health? Evidence from a panel of OECD countries," Health, Econometrics and Data Group (HEDG) Working Papers 10/30, HEDG, c/o Department of Economics, University of York.
  • Handle: RePEc:yor:hectdg:10/30
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    Keywords

    Fiscal decentralization; health outcomes; OECD countries; panel data;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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