Extreme events and the resilience of decentralized governance

Maria Cadaval Sampedro, Ana Herrero Alcalde, Santiago Lago-Peñas and Jorge Martinez-Vazquez
Authors registered in the RePEc Author Service: Santiago Lago-Peñas

No 2212, Working Papers. Collection A: Public economics, governance and decentralization from Universidade de Vigo, GEN - Governance and Economics research Network

Abstract: Extreme events, such as economic crises, pandemics, natural disasters, or military conflicts, can affect the balance between centralization and decentralization forces across countries and transform, temporarily or more permanently, the design of multilevel governance. Using a panel for 91 developing and developed countries from 1960 to 2018, and another one for OECD countries during 1995-2018, we examine the effects of extreme external shocks on the decentralization level. We find that internal conflicts boost decentralization in both OECD and non-OECD countries, while natural disasters reduce decentralization in non-OECD countries, but not so in OECD members. Moreover, those effects are long lasting in both cases of extreme events. Finally, economic recessions are the less relevant kind of shocks. They do not have significant effects on the level of decentralization, except for expenditure decentralization in OECD countries.

Keywords: Fiscal decentralization; extreme events; governance; resilience; political decentralization. (search for similar items in EconPapers)
JEL-codes: H60 H71 H77 H84 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2022-12
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http://infogen.webs.uvigo.es/WP/WP2212.pdf First version, 2022 (application/pdf)

Related works:
Working Paper: Extreme Events and the Resilience of Decentralized Governance (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:gov:wpaper:2212

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