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Kvantifikácia optimálnej miery fiškálnej decentralizácie v krajinách OECD
[Quantification of the Optimal Level of Fiscal Decentralization in OECD Countries]

Author

Listed:
  • Daša Belkovicsová
  • Matej Boór

Abstract

The essence of fiscal decentralization is to increase economic efficiency in the redistribution of resources in the public sector through more effective satisfaction of local public needs by lower levels of government. The article aims to quantify the optimal degree of fiscal decentralization in relation to economic growth in a sample of 29 OECD countries for the years 1975-2018. Empirical research has shown a nonlinear relationship between the degree of fiscal decentralization and economic growth, which takes a parabolic shape. The optimal degree of fiscal decentralization maximizing economic growth reached the level of 31.3656%, or in the case of per capita growth, the level is 31.1309%. In most V4 countries, the degree of fiscal decentralization is at a lower level compared to the optimal one, which is not leading to maximization of economic growth, or economic growth per capita.

Suggested Citation

  • Daša Belkovicsová & Matej Boór, 2021. "Kvantifikácia optimálnej miery fiškálnej decentralizácie v krajinách OECD [Quantification of the Optimal Level of Fiscal Decentralization in OECD Countries]," Politická ekonomie, Prague University of Economics and Business, vol. 2021(5), pages 595-618.
    • Handle: RePEc:prg:jnlpol:v:2021:y:2021:i:5:id:1326:p:595-618
    DOI: 10.18267/j.polek.1326
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    References listed on IDEAS

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    1. Xie, Danyang & Zou, Heng-fu & Davoodi, Hamid, 1999. "Fiscal Decentralization and Economic Growth in the United States," Journal of Urban Economics, Elsevier, vol. 45(2), pages 228-239, March.
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    More about this item

    Keywords

    Degree of fiscal decentralisation; economic growth; economic growth per capita; OECD countries;
    All these keywords.

    JEL classification:

    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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