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Ideology, intergovernmental transfers, and public health spending: Evidence from South Korea

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  • Kang, Youngho
  • Lee, Dongwon
  • Min, Sujin

Abstract

This paper asks whether political ideology affects local government policies through intergovernmental transfers. When local governments depend on intergovernmental transfers, and the upper-tier grantor government has a limited ability to target resources at the local level, the grantor government may use transfers to indirectly promote local public goods that reflect its political ideology. Using data from 226 South Korean municipalities within 15 regions, we show that municipalities located in regions with left-wing regional governments receive significantly more health subsidies from the regional government than those located in regions with right-wing regional governments. The increase in health subsidies leads to greater municipal health spending. Our findings are consistent with the view that party and ideology influence local government policies.

Suggested Citation

  • Kang, Youngho & Lee, Dongwon & Min, Sujin, 2025. "Ideology, intergovernmental transfers, and public health spending: Evidence from South Korea," Regional Science and Urban Economics, Elsevier, vol. 110(C).
    • Handle: RePEc:eee:regeco:v:110:y:2025:i:c:s0166046224001054
    DOI: 10.1016/j.regsciurbeco.2024.104074
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    More about this item

    Keywords

    Government ideology; Public health policy; Local government policy; Intergovernmental transfers;
    All these keywords.

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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