Influence Of Fiscal Decentralization Research Articles

Influence of fiscal decentralization, fintech, and mineral resources on green productivity of G5 countries

The study explores how regional financial autonomy, financial technologies, and resource management strategies intersect to influence sustainable practices and environmental efficiency in G5 economies. The yearly data from 1990 to 2021 has been taken for Canada, Japan, Germany, the United Kingdom, and the United States of America. Empirical analysis of the Cross-sectional Augmented Distributed Lag (CS-ARDL) modeling framework has been performed after a preliminary investigation regarding the variables' cross-sectional dependence, slope heterogeneity, and unit root properties. The outcomes of long-run estimation reveal the positive impact of fintech and revenue decentralization, while mineral resources and expenditure decentralization negatively influence green productivity. Similar results are observed in the short-run; however, their marginal effects are relatively lower. Moreover, the error correction term is negative and significant, indicating an 81.4% speed of adjustment annually to restore the obtained model's equilibrium system. These estimates are validated by the Augmented Mean Group (AMG) and Common Correlated Effect Mean Group (CCEMG) estimators. A bi-directional causality of fintech and revenue decentralization is observed, which offers valuable policy implications.

Fiscal Decentralization, Environmental Regulation and High-Quality Economic Development

Fiscal decentralization, as a policy with which to regulate the financial power relationships between central and local governments, undoubtedly has an impact on high-quality economic development, and in the current context of focusing on environmental quality its path may include environmental regulation, which is restricted by the degree of decentralization and directly affects high-quality economic development. Based on data from 30 Chinese provinces from 2010 to 2019, this paper empirically tests the moderating effect of environmental regulation on the relationship between fiscal decentralization and high-quality economic development through the use of an intermediary-effect model, a threshold model, and a quantile regression model. The following are the main conclusions: First, fiscal decentralization encourages high-quality economic development with a coefficient of 0.069, but environmental regulation dampens this effect, with a coefficient value of 0.0055 for the suppression effect; after removing endogenous effects, the conclusion remains valid. Second, the influence of fiscal decentralization has different manifestations under different environmental regulation intensities and different levels of high-quality economic development: fiscal decentralization has a larger regression coefficient when the intensity of environmental regulation exceeds 0.0108; it only shows a positive effect in regions with a higher quality of economic development (after the 25% quantile). The main contribution of this paper is the discussion of the impact of fiscal decentralization on high-quality economic development from the perspective of environmental regulation and revealing of a new path for fiscal decentralization to play its role, which is of certain significance in exploring the appropriate degree of decentralization and formulating environmental regulation policies.

Fiscal Decentralization, Government Environmental Preference and Industrial Green Transformation

Based on the theory of fiscal decentralization and sustainable development, and the mechanism analysis about fiscal decentralization and government environmental preference to promote industrial green transformation, using China’s provincial panel data from 2006 to 2019, this paper empirically tests the effect of fiscal decentralization and government environmental preference on industrial green transformation by stepwise regression, threshold effect analysis, and the panel simultaneous equation. Results show that fiscal decentralization promotes industrial green transformation, but it also has a certain inhibitory effect on the government’s environmental preference, which results in an insufficient government role in the process of industrial green transformation. In the long run, the influence of fiscal decentralization and government environmental preference has a threshold effect; also, regional heterogeneity exists, as with regional economic level improvement, the influence became stronger. According to the regional survey, fiscal decentralization has a positive effect on industrial green transformation in the eastern region, while it has no significant effect in the central region and a negative effect in the western region. Therefore, countermeasures are put forward, from aspects such as fiscal decentralization and environmental power structure reform, to optimizing the performance evaluation mechanism for improving the government’s environmental preference, so as to have a positive effect on the green transformation of industries.

Influence of fiscal decentralization and renewable energy investment on ecological sustainability in EU: What is the moderating role of institutional governance?

Rising environmental concerns are gaining much attention in the recent literature. However, the dynamic impact of fiscal decentralization and renewable energy investment has been reflected with little evidence. It is imperative to evaluate the role of these factors in a multivariate framework of foreign direct investment and institutional governance using selected European Union (EU) countries from 2000 to 2020. The study applied advanced-panel methods entitled Cross-sectional augmented autoregressive distributed lags (CS-ARDL) to estimate the long-run and short-run relationships among variables. The initial findings confirmed the interdependence between the cross-sectional units, heterogeneity in the slope coefficients, and the existence of panel cointegration. The long-run and short-run results indicate that fiscal decentralization, institutional governance, and renewable energy investment significantly improved ecological sustainability. In contrast, foreign direct investment caused higher emissions, endorsing the pollution haven hypothesis in the region. The findings confirm a significant moderating role of institutional governance in the association between fiscal decentralization, renewable energy investments, and carbon emission. These findings suggest that combining the impact of governance structure with renewable energy investment and fiscal decentralization offers more substantial effects in terms of optimal renewable energy transition and high regional autonomy.

How do fiscal decentralization and intergovernmental fiscal transfers affect energy consumption in China?

Since the reform of the tax-sharing system in 1994, the regulation of the central government to local governments has relied on the mean of intergovernmental fiscal transfers (IFTs) to a certain extent. However, the existing literature has not yet explored the influence of fiscal decentralization (FD) on energy consumption in the presence of IFTs. Thus, this study empirically examines the influences of FD and IFTs on energy consumption by using panel data for 30 Chinese provinces during the period of 1998–2019. Results indicate that FD and IFTs have positive effects on energy consumption. Moreover, the positive influence of FD on energy consumption is strengthened by the improvement in IFTs. In addition, FD and IFTs affect energy consumption through industrial structure upgrading. In terms of policy implications, this study suggests that China may further reduce energy consumption by appropriately reducing the degree of FD, optimizing the intergovernmental fiscal transfer system, and promoting the upgrading of industrial structure.

Research on the Influence of Fiscal Decentralization on the Return Rate of China’s Real Economy

Based on the panel data of 30 provinces from 2000 to 2020, this paper empirically analyzes the impact of local fiscal decentralization on the return rate of China’s real economy from two dimensions, that is, income decentralization and expenditure decentralization. It is found that income decentralization and expenditure decentralization can improve the overall real economic return rate with heterogeneity in different regions. The empirical results in the central region are consistent with the core conclusions, and the regression results of expenditure decentralization in the eastern and western regions are significant, while income decentralization is not significant. With industrial structure affecting the role of fiscal decentralization, the more advanced the industrial structure, the greater role of fiscal decentralization in promoting the return rate of the real economy.

The Influence of Fiscal Decentralization, Economic Growth, and Economic Openness on the Inter-Provincial Development Disparity in Java During 2001-2017

In general, economic growth is defined as a process which leads to the increase of per capita income of a population in a long term. Inter-region disparity in terms of economic development is a common phenomenon in a region’s economic activities. This study aims to determine the effect of economic growth, economic openness, and the degree of fiscal decentralization on development disparities between provinces in Java within 2001-2017. Panel data regression was used together with the Random Effect Model as a data analysis technique. The data used was panel data consisting of time series data from 2001-2017 and cross-sectional data covering Special Capital Region of Jakarta, West Java, East Java, Special Region of Yogyakarta, Central Java, and Banten. The results show that economic growth and fiscal decentralization significantly influence development disparity between provinces in Java while economic openness does not affect the development inequality.

Influence of fiscal decentralization on the economic growth of public welfare and poverty between regions of Province of Papua

This research aims to understand the impact of fiscal decentralization on improving the economy, public welfare, and poverty in the province of Papua. The population and sample of this research were 20 districts/cities in the Papua province. The data analysis used a multivariate model analysis based on the structural equation Modeling WarpPLS variant. The results showed that fiscal decentralization positively influenced the economic growth and the improvement in public welfare, but negatively influenced poverty. Meanwhile, economic growth negatively influenced public welfare. On the other hand, the growth positively influenced poverty reduction, and public welfare influenced poverty. In addition, the results of the mediation test showed that economic growth was able to fully mediate between fiscal decentralization and poverty reduction, yet the economic growth became the partial mediation between fiscal decentralization and public welfare.

Fiscal decentralization, preference for government innovation and city innovation

PurposeThe purpose of this paper is to examine whether fiscal decentralization has impacts on city innovation level and to examine the moderating effects of the preference for government innovation in China.Design/methodology/approachUsing a panel data of China’s 278 cities from 2003 to 2016, the authors first use fixed-effect model and quantile regression to analyze the impact of fiscal decentralization on city innovation level and the variations of impacts conditional on different innovation levels, followed by a mediating effect model to test the moderating effects of the preference for government innovation and its temporal and spatial heterogeneity.FindingsThe paper finds that fiscal decentralization significantly inhibited city innovation, and with the improvement of city innovation level, the inhibition demonstrated characteristics of “V” type variation. When the degree of fiscal decentralization is between 0.377 and 0.600, the inhibition of fiscal decentralization on city innovation level is the weakest. We further show that fiscal decentralization also inhibits the government's preference for innovation, reduces the proportion of fiscal expenditure on innovation and has a negative impact on city innovation. In addition, the influence of fiscal decentralization on city innovation present clear heterogeneity in space and in time. On one hand, the inhibition of fiscal decentralization on city innovation level in eastern China is significantly weaker than that in central and Western China; on the other hand, after the implementation of China’s innovation-driven development strategy in 2013, the negative impact of fiscal decentralization on city innovation disappeared.Research limitations/implicationsThe research findings have certain policy implications. That is, in the process of decentralization reform, on the one hand, the central government should strengthen the supervision over the fiscal expenditure of local governments and ensure that the central government can play a leading role in the local development strategy, on the other hand, the central government should guard against the distortion of fiscal decentralization on local governments' fiscal expenditure behavior. In addition, the central government should also focus on the heterogeneity of the impacts of fiscal decentralization on cities under different strategic backgrounds and different levels of innovation.Originality/valueThis paper extends prior research by bringing the decentralization system reform into the study of city innovation system and analyzing its mechanism and its temporal and spatial heterogeneity.

The Analysis on the Influence of Fiscal Decentralization on Carbon Emission

Among the many factors affecting carbon emissions, the degree of fiscal decentralization is an important factor that cannot be ignored. Based on the SPIRPAT model, using provincial panel data, this paper discusses the impact of fiscal decentralization on carbon dioxide emissions in China. In order to evaluate the effect of local fiscal system on the environment, this paper selects four indicators to reflect the degree of fiscal decentralization respectively, and combines other economic and social explanatory variables to build a panel data model. The results imply that when we use different indicators to characterize the degree of fiscal decentralization, it can be concluded that the degree of fiscal decentralization has a significant positive effect on carbon emissions. In current stage of development in China, the improvement of local government fiscal autonomy is not conducive to carbon emissions reduction. Due to the domestic fiscal decentralization and the promotion mechanism of government officials, local governments are only inspired by economic growth. So as the improvement of the degree of local government fiscal autonomy, the government has to sacrifice public goods with positive environmental externalization to support the development of the high carbon industries with higher economic benefits.

The Influence of Fiscal Decentralization on Economic Growth

The purpose of this study is to know and analyze the influence of the local revenue, the balance fund, the capital expenditure and the private investment on economic growth. This research is an exploratory study conducted on 19 regency/city government in West Sumatera Province. Data analysis techniques are descriptive analysis, classical assumption test, and panel data regression analysis. The results of this study found that: 1) The local revenue of the region has no significant effect on economic growth, 2) the Balance fund has a significant positive impact on economic growth, 3) the Capital expenditure has a significant positive effect on economic growth, 4) the Private investment has a significant positive effect on economic growth.

Efficiency Evaluation and Influencing Factors Analysis of Governmental Expenditure on Preschool Education

With the DEA-Tobit analysis method and based on the panel statistic of thirty-one provinces from 1998 to 2015 in China, this paper studies the efficiency upon local government expenditure of preschool education and its’ influence factors. First, the efficiencies on preschool education spending of local governments, including the overall technical efficiency, scale technical efficiency and pure technical efficiency, were evaluated by the data envelopment analysis approach (DEA). Based on the research result from the 1st step, Tobit model was used to investigate the connection of the efficiency measurement outcomes and preschool education policy variable fiscal decentralization, the connection of the efficiency measurement outcomes and social factors, such as density of population, GDP per capita and the public education degrees and so on. With the explanation of the measurement outcomes, it is noticed that the expenditure efficiency on local government preschool education has improved and have showed significant differences in CN. The influences of degree of urbanization, the density of population and education degree upon the efficiency of governmental preschool education spending and GDP per capita are positive. After the control of population, social and economic factors, the influence of fiscal decentralization upon the efficiencies on preschool education public spending is negative, the efficiencies on preschool education spending of local government has been greatly improved by preschool education policy in China.

The spatial spillover effect of fiscal decentralization on local public provision: Mathematical application and empirical estimation

This paper examines the spillover effect of fiscal decentralization on the provision of local public goods. The paper's objectives are as follows. First, we seek to discuss whether fiscal decentralization can affect “Promotion Tournament Game” among local governments through spillover effect of local public goods supply. Second, we also examine the intrinsic mechanism of such decentralized spillover effect. Finally, we analyze, if the spillover effect is possible, how much influence of fiscal decentralization on local public provision from both expenditure and revenue perspectives. Our analysis is based on a user fee model. The panel data from 31 Chinese provinces for the period of 1994–2013 are estimated using the spatial econometric method. The results show that revenue decentralization is negatively related to the local public provision, which is consistent with the “Leviathan hypothesis”. However, expenditure decentralization leads to an increase in the local public provision, which statistically proves the fierce competition in “Promotion Tournament Game” among Chinese governments.

Fiscal Decentralization - A Survey of the Empirical Literature

We survey the empirical literature on fiscal decentralization (FD) and analyze the advantages and disadvantages of shifting fiscal responsibilities to sub national governments. We suggest several conclusions: First, there are large disagreements regarding the influence of FD on the size of government and the effect of FD on tax competition, economic growth and corruption. Probably the only unanimous conclusion is that intergovernmental grants are heavily influenced by political considerations. The empirical literature deals with several additional issues which are related to FD. While the literature on these topics is more scant and is not always econometrically rigorous, it is also more in agreement: there is no evidence for a race to the bottom in welfare transfers due to FD; FD seems to increase inequality in developing countries but to decrease inequality in developed economies and there seem to be economies of scale in the provision of several local public services. We conclude that there is no general answer regarding the net effect of FD. Fiscal decentralization reforms have to consider a wide array of factors and local contingencies before a successful implementation could be made.

PENGARUH DESENTRALISASI FISKAL TERHADAP PERTUMBUHAN EKONOMI DI PROVINSI BENGKULU

Since 2001, the Indonesian government has effectively run fiscal decentralization policy as a broad strategy to accelerate regional development. This study aims to see the influence of fiscal decentralization on economic growth in the province of Bengkulu. The analysis focused on indicators of fiscal decentralization of expenditure. And using a set of control variables consisting of the Initial Level Growth, Population Growth, Investment, and Human Capital. This study uses panel data and analytical tools of LSDV or Fixed Effects Model (FEM). The study shows that there is a hump-shaped form in the influence of fiscal decentralization in the province of Bengkulu. This means that when the degree of fiscal decentralization is not too high, then the fiscal decentralization policy will bring positive impact on economic growth, but the degree of decentralization is too high, fiscal decentralization policies will only hinder economic growth.

PERAN DESENTRALISASI FISKAL TERHADAP KINERJA EKONOMI DI KABUPATEN/KOTA PROVINSI JAWA TENGAH

This research is intended to examine the influence of fiscal decentralization on economic growth, poverty, employment, and welfare at regencies/municipalities level in Central Java Province. Research population consist of 29 regencies and 6 municipalities, employing secondary data from Central Bureau of Statistic of Central Java Province and regencies/municipalities level in Central Java Province within the period of 2001 up to 2005. Data analysis is conducted by using path analysis with AMOS program software. The results of this study indicate that, first fiscal decentralization has a positive and significant effect on economic growth. Second, economic growth has a positive and significant effect on employment rate. Third, economic growth has a negative and significant effect on poverty. Forth, economic growth has a positive and significant effect on welfare. Fifth, employment rate has a negative and significant effect on welfare. Sixth, poverty has a negative and significant effect on welfare at regencies/municipalities level in Central Java Province.