a r t i c l e i n f o A political-economy model is developed to explain why fiscal decentralization may have a non-monotonic effect on FDI inflows through endogenous policies. Too much fiscal decentralization hurts central government incentives, whereas too little fiscal decentralization renders the local governments vulnerable to capture by the protectionist special interest groups. Moreover, ...

Decentralization has dramatically altered governance in developing countries. However, the empirical evidence on its welfare effects has been limited and ambiguous. I argue that this ambiguity is due to a misidentification of different types of decentralization – namely administrative, political and fiscal – and their synergies. In order to test this claim, the paper employs a unique Indonesian...

— This paper attempts to quantify the impact of fiscal decentralization in India on its social infrastructure and on rural development. Overall, the results in this paper indicate that Government of India within a federal framework has been fostering development equitably across its states, particularly through health and education expenditures aimed at improving human capital development. In t...

— This study is the first attempt to examine the determinants of expenditure decentralization at sub-provincial levels in China. The Chinese central government gives detailed guidelines to local governments on public finance, but, ironically, their expenditure assignment is far from being well-regulated. Differences in fiscal decentralization on the expenditure side are enormous among local gov...

Decentralization occupies an important space in debates over public-sector reform in doi moi Vietnam. This paper assesses the changing distribution of roles, responsibilities and resources across levels of government over the past decade. Vietnam is incrementally transfering greater administrative and fiscal responsibilities to the provincial level. In addition, the Communist Party is attemptin...

The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. INTRODUCTION Alongside the familiar economic and democratic-electoral reforms that have occurred in African countr...

A couple decades ago fiscal federalism used to be a topic of marginal importance in most countries and in the economic literature. The world was broadly divided in federal states and unitary states and there were hardly any countries that planned to move from one to the other of these categories. In recent years, however, perhaps as a result of globalization and deepening democratization, combi...

This paper is part of a wider research on South and East Asia countries’ taxation, carried over at this Department, under the direction of L. Bernardi, A. Fraschini and P. Shome, and under the supervision of. V. Tanzi. In South and East Asian countries a highly centralized government prevails, although recently some trends are moving toward a greater degree of decentralization. Also the two gia...