This chapter surveys recent contributions to the study of fiscal decentralization which adopt a
political economy approach. By a political economy approach, I mean a systematic attempt …

This essay contributes to second generation fiscal federalism (SGFF), which traces the
implications of incentives created by political and fiscal institutions. The approach explores …

Decentralization can improve service delivery, but it can also generate externalities across
jurisdictional boundaries. We examine the nature and size of water pollution externalities as …

Fiscal federalism concerns the division of policy responsibilities among different levels of
government. Many current economic and policy developments, such as globalization …

Political competition is widely recognized as a mediator of public goods provision through its
salutary effect on incumbents' electoral incentives. We argue that political competition …

We present a model of endogenous growth where government provides a productive public
good financed by income and capital taxes. In equilibrium, a decentralized government …

We study the effect of decentralization on corruption in a political agency model from the
perspective of a region. In a model where corruption opportunities are lower under …

This paper provides an empirical test of a principal tenet of fiscal federalism: that spending
discretion, when granted to localities, allows public-good levels to adjust to suit local …

Recent theoretical research suggests that financing sub-national governments' expenditure
out of own revenue sources is linked to more responsible budgeting, because the financial …

This paper examines whether an increase in political decentralization, which is a global
trend, affects income inequality. It argues that the effect of decentralization on equality lies …