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A new approach to test the effects of decentralization on public infrastructure investment

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  • Henry Aray

Abstract

This paper proposes a simple theoretical framework to obtain a tractable equation that considers the traditional criteria for allocating public infrastructure investment and variables to capture decentralization. Panel data for the regions of Spain over the period 1986–2010 are used. Positive effects of fiscal and administrative decentralization on public investment in infrastructure are found. The results are strongly robust to different relative measures of public infrastructure investment, estimation methods and databases. Moreover, in line with recent theoretical literature, additional estimations suggest that such effects are bounded and there is no long-run relationship between decentralization and public infrastructure investment.

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  • Henry Aray, 2019. "A new approach to test the effects of decentralization on public infrastructure investment," Regional Studies, Taylor & Francis Journals, vol. 53(7), pages 1042-1057, July.
    • Handle: RePEc:taf:regstd:v:53:y:2019:i:7:p:1042-1057
    DOI: 10.1080/00343404.2018.1538552
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    Cited by:

    1. Federico Aresu & Emanuela Marrocu & Raffaele Paci, 2023. "Public capital and institutions' quality in the Italian regions," Journal of Regional Science, Wiley Blackwell, vol. 63(5), pages 1284-1308, November.
    2. Aray, Henry & Pacheco-Delgado, Janeth, 2020. "Public investment allocation across Ecuadorian Provinces," Socio-Economic Planning Sciences, Elsevier, vol. 71(C).

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