Fiscal decentralization and citizens' satisfaction with public services: Evidence from a micro survey in China

Abstract

Our study matches multiple rounds of China Family Panel Studies (CFPS) data from 2012 to 2020 with regional macro fiscal and economic data, and explores the impact of regional fiscal decentralization on citizens' satisfaction with public services from the subjective perception of individual respondents. The study found that the increase in regional fiscal decentralization has a significant positive effect on improving the satisfaction of citizens with public services. However, due to differences in individual characteristics among the surveyed individuals, this effect has obvious heterogeneity. Mechanism analysis showed that the enhancement of local government's awareness of public service supply and the increase of regional fiscal transparency have a promoting effect on the improvement of citizens' satisfaction with public services. From the perspective of the convergence in the perception of public service satisfaction among citizens within the same province, the increase of fiscal decentralization has not effectively promoted the equalization development of public services at the provincial level in China.