Going Local: Public Spending, Bureaucratic Efficiency and Decentralization

FBK-IRVAPP is pleased to invite you to the following seminar: Going Local: Public Spending, Bureaucratic Efficiency and Decentralization .

With the participation of Augusto Cerqua (Sapienza University of Rome)

The seminar is held in English.

Abstract 

Decentralization policies are aimed at achieving efficient management of public funds and improved provision of public goods, leveraging allocative efficiency and the benefits of yardstick competition among local governments. However, the impact of these policies on local development remains a subject of debate as the decentralization process may exacerbate pre-existing disparities in bureaucratic performance, reinforcing the influence of local administrations. This hypothesis is examined through an analysis of a significant constitutional decentralization reform enacted in Italy in 2001 (L.Cost. 3/2001). Our spatial difference-in-discontinuities design estimates reveal that municipalities affected by the reform tend to increase their investment expenditure and generally reallocate funds for public service provision. Moreover, municipalities with initially lower levels of bureaucratic capacity tend to decrease their total expenditure on nursery schools and waste collection. Conversely, municipalities with higher pre-reform performance levels are found to increase spending on investment and the provision of administrative services.