تمرکززدایی و بازنگری رشد اقتصادی: یک یادداشت تجربی  

Although it is theoretically expected that decentralization leads to efficient provision of local public services and stimulates economic development, there is a mixed picture of the decentralization effect on economic growth across earlier empirical studies. Using the instrument variables (IV) technique with the latest cross-country data for the period from 1997 to 2001, this paper found that fiscal decentralization has a significant positive impact on per capita GDP growth. Therefore, when the focus is placed on the latest information on the economic situation in the latter 1990s, decentralization, particularly on the fiscal expenditure side, is instrumental in economic growth.

Decentralization is now a political-economy trend in both developing and developed countries. In theory, there is no doubt that decentralization leads to efficient provision of public services and results in rapid economic development. From the empirical viewpoint, however, it remains controversial whether there is any relationship between decentraliza-tion and growth. In reality, decentralization is a complicated phenomenon and is characterized by various aspects at different levels. The aim of this paper is to empirically readdress the question of whether any forms of decentralization stimulate growth, using the latest cross-country data from 1997 to 2001. With regard to the linkage between decentralization and growth, there has been a marked inconsistency between economic theory and empirical evidence. As pointed out by Davoodi and Zou [3], it is an unquestioned belief in the basic theory that due to informational advantage based on a physical and institutional proximity to local residents, the devolution of political and administrative power to lower level governments leads to improved economic efficiency in local public service delivery and thus augments the growth rate at the national and regional levels. This is the so-called Oates’ Decentralization Theorem. The fundamental assumption underlying this belief is that residents could move and choose between jurisdictions that provide different packages of local public goods and taxes. In this Tiebout mechanism based on “voting with feet,” local governments are required to respond to the residential demand for public services in an efficient and effective way. Otherwise, residents would consider moving away to municipalities that are better managed.

Although many developing and developed countries have devoted themselves to decentralization, it is still arguable whether decentralization stimulates economic growth. In theory, it is expected that decentralization leads to efficient provision of local public services and results in rapid economic development. Earlier empirical literature indicates that the relationship between decentralization and growth is unclear. This paper aims to readdress this inconsistency between theory and evidence, using the instrumental technique with the latest data for the period from 1997 to 2001. It is found that there is a significant positive relationship between per capita growth rate and fiscal decentralization measured by the local share of the expenditure to total government expenditure. This finding marks a striking contrast with existing empiricalwork in this area. It can be concluded that, if focusing on the latest economic situation in the latter 1990s, decentralization, particularly on the fiscal expenditure side, is instrumental in promoting economic growth.