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Decentralization, Subjective Well‐Being, and the Perception of Institutions

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  • Luis Diaz‐Serrano
  • Andrés Rodríguez‐Pose

Abstract

This paper analyses whether the different powers and resources at the disposal of local and regional governments across Europe deliver greater satisfaction with political institutions and lead to greater personal happiness. The analysis uses microdata from the four available waves of the European social survey (2002, 2004, 2006 and 2008), including more than 160,000 observations of individuals living in 29 European countries. Our results reveal that fiscal and some forms of political decentralization have a positive and significant effect on the overall subjective well-being of individuals. However, fiscal decentralization has a different effect on the perception of institutions depending on whether we consider subnational expenditure or revenues. Similarly, the effect of political decentralization on the level of satisfaction with institutions also varies depending on whether the capacity of local governments to influence national politics or to exert authority over their own citizens is considered. The results also show that citizens seem to be happier with the actual capacity of their local governments to deliver than with the general principle that they can have a say on their daily politics and policies. Keywords: Happiness, subjective well-being, satisfaction, fiscal and political decentralization, Europe. JEL codes: H11, H77
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  • Luis Diaz‐Serrano & Andrés Rodríguez‐Pose, 2012. "Decentralization, Subjective Well‐Being, and the Perception of Institutions," Kyklos, Wiley Blackwell, vol. 65(2), pages 179-193, May.
  • Handle: RePEc:bla:kyklos:v:65:y:2012:i:2:p:179-193
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    Cited by:

    1. Luis Diaz-Serrano & Enric Meix-Llop, 2019. "Decentralization and the quality of public services: Cross-country evidence from educational data," Environment and Planning C, , vol. 37(7), pages 1296-1316, November.
    2. Sarah Flèche, 2015. "Distaste for Centralization: Evidence from a Quasi-Natural Experiment in Switzerland," CEP Discussion Papers dp1383, Centre for Economic Performance, LSE.
    3. Andrés Rodríguez-Pose & Vassilis Tselios, 2019. "Well-being, Political Decentralisation and Governance Quality in Europe," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 20(1), pages 69-93, January.
    4. Díaz Serrano, Lluís & Meix Llop, Enric, 2018. "Decentralization and the Quality of Public Services: Cross-Country Evidence from Educational Data," Working Papers 2072/351581, Universitat Rovira i Virgili, Department of Economics.
    5. Luis Diaz-Serrano & Andrés Rodríguez-Pose, 2015. "Decentralization and the Welfare State: What Do Citizens Perceive?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 120(2), pages 411-435, January.
    6. Leonardo E. Letelier-S & José L. Sáez-Lozano, 2020. "Expenditure Decentralization: Does It Make Us Happier? An Empirical Analysis Using a Panel of Countries," Sustainability, MDPI, vol. 12(18), pages 1-17, September.
    7. Diaz-Serrano, Luis & Meix-Llop, Enric, 2012. "Do Fiscal and Political Decentralization Raise Students' Performance? A Cross-Country Analysis," IZA Discussion Papers 6722, Institute of Labor Economics (IZA).
    8. Longjin Chen & Jian Huang & Jianjun Li, 2017. "Fiscal Decentralization, Satisfaction with Social Services, and Inequality Under the Hukou System," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 132(1), pages 377-394, May.
    9. Andrea Filippetti, 2018. "Does diversity undermine the provision of local public services in European regions?," Management Working Papers 15, Birkbeck Department of Management, revised Feb 2021.
    10. Duncan M. Wagana & Mike A. Iravo & Joyce D. Nzulwa & John M. Kihoro, 2016. "Effect of Financial and Political Decentralization on Service Delivery in County Governments in Kenya," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 6(6), pages 304-320, June.
    11. Sujarwoto Sujarwoto & Gindo Tampubolon & Adi Cilik Pierewan, 2018. "Individual and Contextual Factors of Happiness and Life Satisfaction in a Low Middle Income Country," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 13(4), pages 927-945, December.
    12. Vassilis Tselios & John Tomaney, 2019. "Decentralisation and European identity," Environment and Planning A, , vol. 51(1), pages 133-155, February.
    13. ., 2014. "Devolution, city governance and economic performance," Chapters, in: Urban Economics and Urban Policy, chapter 7, pages 157-184, Edward Elgar Publishing.
    14. Jian Huang & Longjin Chen & Jianjun Li & Wim Groot, 2017. "Expenditure Decentralization and Citizen Satisfaction with Healthcare: Evidence from Urban China," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 133(1), pages 333-344, August.
    15. Ryota Nakatani & Qianqian Zhang & Isaura Garcia Valdes, 2024. "Health Expenditure Decentralization and Health Outcomes: The Importance of Governance," Publius: The Journal of Federalism, CSF Associates Inc., vol. 54(1), pages 59-87.

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    More about this item

    Keywords

    happiness; subjective well-being; satisfaction; fiscal and political decentralization; europe. jel codes: h11; h77
    (this abstract was borrowed from another version of this item.)
    ;
    All these keywords.

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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