The Impact of Fiscal Decentralization: A Survey

Abstract

The Andrew Young School of Policy Studies was established at Georgia State University with the objective of promoting excellence in the design, implementation, and evaluation of public policy. In addition to two academic departments (economics and public administration), the Andrew Young School houses seven leading research centers and policy programs, including the International Center for Public Policy.The mission of the International Center for Public Policy is to provide academic and professional training, applied research, and technical assistance in support of sound public policy and sustainable economic growth in developing and transitional economies.The International Center for Public Policy at the Andrew Young School of Policy Studies is recognized worldwide for its efforts in support of economic and public policy reforms through technical assistance and training around the world. This reputation has been built serving a diverse client base, including the World Bank, the U.S. Agency for International Development (USAID), the United Nations Development Programme (UNDP), finance ministries, government organizations, legislative bodies and private sector institutions.The success of the International Center for Public Policy reflects the breadth and depth of the in-house technical expertise that the International Center for Public Policy can draw upon. The Andrew Young School's faculty are leading experts in economics and public policy and have authored books, published in major academic and technical journals, and have extensive experience in designing and implementing technical assistance and training programs. Andrew Young School faculty have been active in policy reform in over 40 countries around the world. Our technical assistance strategy is not to merely provide technical prescriptions for policy reform, but to engage in a collaborative effort with the host government and donor agency to identify and analyze the issues at hand, arrive at policy solutions and implement reforms.The International Center for Public Policy specializes in four broad policy areas:  Fiscal policy, including tax reforms, public expenditure reviews, tax administration reform  Fiscal decentralization, including fiscal decentralization reforms, design of intergovernmental transfer systems, urban government finance  Budgeting and fiscal management, including local government budgeting, performancebased budgeting, capital budgeting, multi-year budgeting  Economic analysis and revenue forecasting, including micro-simulation, time series forecasting,For more information about our technical assistance activities and training programs, please visit our website at

Decentralization and the quality of public services: Cross-country evidence from educational data

“…Last but not least, as pointed out by Martinez-Vazquez et al (2017), a relevant issue regarding the analysis of the impact of decentralization is the proper measurement of decentralization itself and its potential endogeneity in econometric estimates. In this paper, we overcome the endogeneity issue, but we emphasize the measurement problem.…”

Decentralization and Football*

“…According to the well‐established theory of fiscal federalism, a decentralized government structure involves an increased citizen welfare and efficiency in the allocation of resources (Martínez‐Vázquez, Lago‐Peñas, and Sacchi, ). Proximity makes information flow more easily and gives more flexibility to match citizens’ needs and preferences.…”

Fiscal Institutions and the Size and Inter-Regional Distribution of Public Redistribution

“…7 Local spending is determined by the following formulas: where is the national budget devoted to redistribute income, is the share of public funds allocated to district and is the per-capita transfer for residents of district . 8 Hence, the problem of policy design for a benevolent social planner at the central government is to set the income tax , the budget and tax revenue shares that finance the redistributive programs of local governments in each district to maximize the social welfare of residents of all districts where is the weight that the social planner at the central government allocates for the well-being of households with wage . The budget constraint of the central government is…”