Fiscal decentralization, political heterogeneity and welfare

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buir.contributor.authorNeyapti, Bilin
buir.contributor.orcidNeyapti, Bilin|0000-0002-1819-7804
dc.citation.epage376en_US
dc.citation.issueNumber5en_US
dc.citation.spage347en_US
dc.citation.volumeNumber31en_US
dc.contributor.authorAslim, Erkmen Giray
dc.contributor.authorNeyapti, Bilin
dc.date.accessioned2023-02-28T08:01:43Z
dc.date.available2023-02-28T08:01:43Z
dc.date.issued2022
dc.departmentDepartment of Economicsen_US
dc.description.abstractThis paper contributes to the literature on fiscal decentralization by presenting a formal model of the interaction between the central and local governments (CG and LGs, respectively) where LGs may differ in their degree of political alignment with CG. The non-cooperative optimal behaviour of the agents reveals that optimal tax increases with the extent of fiscal decentralization (FD), political unison and spillovers across localities, while LGs’ optimal tax collection effort is negatively associated with all of these parameters. The first novel finding of our study is that both welfare peaks and income distribution are more equitable at a lower level of FD in the case of spillovers than in the case of no spillovers, which supports the decentralization theorem. The second novel finding is that both the amount of redistributable income and central government utility increase with the degree of political unison. © 2022, University of Economics - Prague. All rights reserved.en_US
dc.description.provenanceSubmitted by Cem Çağatay Akgün (cem.akgun@bilkent.edu.tr) on 2023-02-28T08:01:43Z No. of bitstreams: 1 Fiscal_decentralization_political_heterogeneity_and_welfare.pdf: 601538 bytes, checksum: ded1cc029abfe0305666a7e9ab6cbab4 (MD5)en
dc.description.provenanceMade available in DSpace on 2023-02-28T08:01:43Z (GMT). No. of bitstreams: 1 Fiscal_decentralization_political_heterogeneity_and_welfare.pdf: 601538 bytes, checksum: ded1cc029abfe0305666a7e9ab6cbab4 (MD5) Previous issue date: 2022en
dc.identifier.doi10.18267/j.pep.813en_US
dc.identifier.issn12100455
dc.identifier.urihttp://hdl.handle.net/11693/111885
dc.language.isoEnglishen_US
dc.publisherUniversity of Economics - Pragueen_US
dc.relation.isversionofhttps://dx.doi.org/10.18267/j.pep.813en_US
dc.source.titlePrague Economic Papersen_US
dc.subjectFiscal decentralizationen_US
dc.subjectFiscal efficiencyen_US
dc.subjectWelfareen_US
dc.titleFiscal decentralization, political heterogeneity and welfareen_US
dc.typeArticleen_US

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