- Why do differences in the degree of fiscal decentralization endure?
- Xavier Calsamiglia, Teresa Garcia-Milà and Therese J. McGuire
- August 2004
- A notable difference between the U.S. and many countries in Europe is in the degree of fiscal decentralization. Regional (and local) governments in the U.S. have significant autonomy in setting their own taxes and determining how to spend their revenues. This is not true of their counterparts in Spain, France, the United Kingdom, Czech Republic and many other European countries. In recent years, many countries formerly subject to dictatorships
or communism have been considering decentralizing fiscal responsibility to sub-national governments as part of the process of democratization (see Bird and Ebel, forthcoming). Yet, much of Europe remains immune to adopting effective decentralization in which sub-national units have true taxing authority.
- Fiscal decentralization, regional solidarity, efficiency, preferences for equality
- JEL codes:
- H77, H42, H21
- Area of Research:
- Macroeconomics and International Economics
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