Empirically testing the role of political institutions

In this chapter, we test our theoretical propositions by examining whether political institutions do indeed affect the efficiency with which local public goods are provided. More specifically, we evaluate the key expectation stemming from our theory: that the combination of democratic decentralization and party integration will lead to the best delivery of local public goods with externalities, other things equal. To do this, we make use of a series of quantitative models of all electorally competitive countries from 1975 to 2007 (contingent on data availability), to our knowledge the broadest examination of subnational political institutions in the literature. We employ seven different measures of education policy, seven different measures of health policy, and nine different measures of infrastructure policy to operationalize our dependent variable. For the right side of the equation, we develop an original dataset of subnational political institutions. Our models provide broad support for our theoretical expectations.