Natural Resources, Decentralization, and Risk Sharing: Can Resource Booms Unify Nations?
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Título: | Natural Resources, Decentralization, and Risk Sharing: Can Resource Booms Unify Nations? |
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Autor/es: | Pérez Sebastián, Fidel | Raveh, Ohad |
Grupo/s de investigación o GITE: | Análisis Económico |
Centro, Departamento o Servicio: | Universidad de Alicante. Departamento de Fundamentos del Análisis Económico |
Palabras clave: | Decentralization | Secession | Natural riches | Risk sharing | Corruption | Bargaining power |
Área/s de conocimiento: | Fundamentos del Análisis Económico |
Fecha de publicación: | ene-2016 |
Editor: | Elsevier |
Cita bibliográfica: | Journal of Development Economics. 2016. In Press |
Resumen: | Previous studies imply that a positive regional fiscal shock, such as a resource boom, strengthens the desire for separation. In this paper we present a new and opposite perspective. We construct a model of endogenous fiscal decentralization that builds on two key notions: a trade-off between risk sharing and heterogeneity, and a positive association between resource booms and risk. The model shows that a resource windfall causes the nation to centralize as a mechanism to either share risk and/or prevent local capture, depending on the relative bargaining power of the central and regional governments. We provide cross country empirical evidence for the main hypotheses, finding that resource booms: (i) decrease the level of fiscal decentralization with no U-shaped patterns, (ii) cause the former due to risk sharing incentives primarily when regional governments are relatively strong, and (iii) have no effect on political decentralization. |
Patrocinador/es: | Fidel Perez-Sebastian thanks the Spanish Ministry of Science and Technology (ECO2012-36719), Generalitat Valenciana (PROMETEO/2013/037), and the Instituto Valenciano de Investigaciones Económicas for financial support. |
URI: | http://hdl.handle.net/10045/53088 |
ISSN: | 0304-3878 (Print) | 1872-6089 (Online) |
Idioma: | eng |
Tipo: | info:eu-repo/semantics/preprint |
Derechos: | © Elsevier |
Revisión científica: | si |
Aparece en las colecciones: | INV - Análisis Económico - Artículos de Revistas |
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Archivo | Descripción | Tamaño | Formato | |
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NRFD_JAN16.pdf | Preprint (acceso abierto) | 219,4 kB | Adobe PDF | Abrir Vista previa |
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