Fiscal decentralisation, local institutions and public good provision: evidence from Indonesia

Pal, Sarmistha; Wahhaj, Zaki

doi:10.1016/j.jce.2016.07.004

Cited by 28 publications

(23 citation statements)

References 36 publications

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“…This research suggests that fiscal incentives are critical for designing fiscal decentralization policies for economic growth, which agrees with the study of Han and Kung (). In terms of political institutions, Pal and Wahhaj () observe that fiscal decentralization increases public spending across local communities with respect to local democracy and customary laws in Indonesia. Im () finds negative relationships between the two factors of fiscal decentralization and political decentralization and economic growth when using a data set of 63 countries with a time series spanning from 1960 to 2007.…”

Section: Literature Reviewmentioning

confidence: 99%

Fiscal Decentralization and Economic Growth of Vietnamese Provinces: The Role of Local Public Governance

Thanh

Nguyen

2019

Ann Public Coop Econ

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This study offers an insight into the public governance role in the relationship between fiscal decentralization and provincial economic growth in Vietnam. Fiscal decentralization measures are assorted. Applying a sequential (two‐stage) estimation for the panel data of 62 provinces of Vietnam over the 2006–2015 period, we find that first, fiscal decentralization is positively related to the economic growth of Vietnamese provinces. Second, the effects of public governance on economic growth vary across provinces depending on various levels of local public governance. Interestingly, the effect of fiscal decentralization is strengthened when this variable is added along with better quality of public governance. In a region of high public governance quality, fiscal decentralization exerts a positive effect on its economic growth. Our findings imply that the design of fiscal decentralization needs to be associated with local governments’ ability of public governance to improve the local economic growth.

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Section: Literature Reviewmentioning

confidence: 99%

Fiscal Decentralization and Economic Growth of Vietnamese Provinces: The Role of Local Public Governance

Thanh

Nguyen

2019

Ann Public Coop Econ

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“…Mayors have been responsible for setting electricity policy within their districts since 2005 (Jayawardena, 2005). Moreover, mayors have significant discretionary power in their choice of how to allocate resources across villages (Aspinall and Asad, 2015;Pal and Wahhaj, 2016). Altogether, this suggests scope for rivalry across villages in access to this public resource, and indeed, publicly-provided electricity is a factor underlying some of the violent incidents reported in the SNPK data.…”

Section: Ethnic Favoritismmentioning

confidence: 99%

The Political Boundaries of Ethnic Divisions

Bazzi

Gudgeon

2018

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This paper argues that redrawing subnational political boundaries can transform ethnic divisions. We use a natural policy experiment in Indonesia to show how the effects of ethnic diversity on conflict depend on the political units within which groups are organized. Redistricting along group lines can reduce conflict, but these gains are undone or even reversed when the new borders introduce greater polarization. These adverse effects of polarization are further amplified around majoritarian elections, consistent with strong incentives to capture new local governments in settings with ethnic favoritism. Overall, our findings illustrate the promise and pitfalls of redistricting in diverse countries.

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“…Recent literature analyzing the impact of fiscal decentralization on the public expenditure on certain public services finds that, in the specific case of education, fiscal decentralization boosts public expenditure (Busemeyer, 2008;Pal and Wahhaj, 2017).…”

Section: Empirical Evidence On the Link Between Fiscal Decentralizatimentioning

confidence: 99%

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

Díaz-Serrano

Meix-Llop

2019

Environment and Planning C: Politics and Space

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In this paper, we study the impact of fiscal and political decentralization on the quality of public service delivery. While the effect of fiscal decentralization on public services is a recursive theme, to the best of our knowledge, our study is the first to investigate the impact of political decentralization. We use educational data as a proxy for the quality of public services. We use microdata from the PISA test scores from 22 countries and test for the impact of fiscal and political decentralization on students' performance. We use not only general measures of decentralization but, for the first time, also educationspecific decentralization measures. Our results indicate that the impact of fiscal decentralization on school outcomes is positive. However, the results regarding political decentralization are more ambiguous. We also observe that the scalar effect of both political and economic decentralization becomes more evident in large cities.

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Fiscal decentralisation, local institutions and public good provision: evidence from Indonesia

Cited by 28 publications

References 36 publications

Fiscal Decentralization and Economic Growth of Vietnamese Provinces: The Role of Local Public Governance

Fiscal Decentralization and Economic Growth of Vietnamese Provinces: The Role of Local Public Governance

The Political Boundaries of Ethnic Divisions

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

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