Essays on decentralization and growth in developing countries
(2005)
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- Authors
- Supervisors
- Boucekkine, Raouf
- Abstract
- Since the Seventies, the decentralized governmental structure aroused the interest of many countries in the world, because it questions the monopoly of the central governments as regards decision-making. Many developing countries chose it to escape the shelves from an ineffective and inefficient management and, macro-economic instability and an inadequate economic growth. This thesis intends to trace conditions under which developing countries may improve their development process through decentralization. The first chapter studies the relevance of the economic integration of developing and transition economies through regional integration groups. The interest is devoted to how South-South integration may be beneficial to countries that form the different regional integration groups and which are located in the south hemisphere. We conclude that some South-South economic integrations are wealth creating. The second chapter evaluates empirically if decentralization is beneficial for growth. New tools dealing with the principal component analysis are introduced in this setting. We show that decentralization always does not reinforce the supported economic growth and could not thus be regarded as an end in itself. In addition, our empirical results illustrate that decentralization is in non-linear relationship with the economic growth. Moreover, and for Sub-Saharan African countries, we highlight that decentralization can bring economic and social conditions favourable with an optimal management of ethnic diversity. In the last chapter we evaluate the impact of fiscal decentralization on economic development in developing and transition economies ruled by corrupt administrations. We use a Leviathan model with predatory (undemocratic) governments and weak law enforcement. Our model reveals that economic consequences of fiscal decentralization depend upon how it is designed. We established that decentralization could be growth enhancing as addressed by the market preserving federalism view if it is complete; but it is growth hindering when two level governments share tax base which, give rise to the "tragedy of commons" and increasing corruption.
- Affiliations
Citations
Ntagoma Kushinganine, J.-B. (2005). Essays on decentralization and growth in developing countries. https://hdl.handle.net/2078.5/71196