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Fiscal decentralization, democracy and government size : disentangling the complexities

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Obeng, Samuel Kwabena (2021) Fiscal decentralization, democracy and government size : disentangling the complexities. Journal of International Development, 33 (6). pp. 975-1004. doi:10.1002/jid.3545 ISSN 0954-1748.

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Official URL: https://doi.org/10.1002/jid.3545

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Abstract

This paper examines the mediating effect of democracy in explaining the relationship between decentralization and government size for the period 1970–2013. We proxy decentralization by fiscal decentralization, use total spending as our primary measure of government size and adopt the V-Dem high-level democracy indices as measures of democracy. Our main finding is that the relationship between fiscal decentralization and government spending differs under different types of democracy. From the interaction term, the negative effect of fiscal decentralization diminishes as the democracy level gets higher, particularly for participatory democracy irrespective of whether government size is measured by spending-to-GDP or employment.

Item Type: Journal Article
Subjects: H Social Sciences > HJ Public Finance
J Political Science > JC Political theory
J Political Science > JS Local government Municipal government
Divisions: Faculty of Social Sciences > Economics
Library of Congress Subject Headings (LCSH): Decentralization in government, Fiscal policy, Democracy, Democratization
Journal or Publication Title: Journal of International Development
Publisher: John Wiley & Sons Ltd.
ISSN: 0954-1748
Official Date: August 2021
Dates:
DateEvent
August 2021Published
9 May 2021Available
6 April 2021Accepted
Volume: 33
Number: 6
Page Range: pp. 975-1004
DOI: 10.1002/jid.3545
Status: Peer Reviewed
Publication Status: Published
Access rights to Published version: Open Access (Creative Commons)
Date of first compliant deposit: 19 April 2021
Date of first compliant Open Access: 21 May 2021
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