Fiscal Decentralization and Economic Growth in the United States

Fiscal Decentralization and Economic Growth in the United States

In a simple model of endogenous growth with spending by different levels of government, we demonstrate how fiscal decentralization affects the long-run growth rate of the economy. Applying the model to the U.S. economy, we find that the existing spending shares for state and local governments have b...

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Veröffentlicht in:Journal of urban economics 1999-03, Vol.45 (2), p.228-239
Hauptverfasser: Xie, Danyang, Zou, Heng-fu, Davoodi, Hamid
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Sprache:eng
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Economic growth
Fiscal policy
Local government
Public expenditure
U.S.A
Urban economics
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container_title Journal of urban economics
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creator Xie, Danyang
Zou, Heng-fu
Davoodi, Hamid
description In a simple model of endogenous growth with spending by different levels of government, we demonstrate how fiscal decentralization affects the long-run growth rate of the economy. Applying the model to the U.S. economy, we find that the existing spending shares for state and local governments have been consistent with growth maximization. In this sense, further decentralization in public spending may be harmful for growth.
doi_str_mv 10.1006/juec.1998.2095
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1095-9068
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source RePEc; Periodicals Index Online; Access via ScienceDirect (Elsevier)
subjects Economic growth
Fiscal policy
Local government
Public expenditure
U.S.A
Urban economics
title Fiscal Decentralization and Economic Growth in the United States
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