Abstract

REIS MOURAO, Paulo. Decentralization and inequality in the distribution of Brazilian federal funds. A cointegration analysis between 1997 and 2011. Cuad. Econ. [online]. 2017, vol.36, n.71, pp.321-344. ISSN 0121-4772.  https://doi.org/10.15446/cuad.econ.v36n71.52854.

This article discusses how the distribution of decentralized grants for Brazilian States affects the evolution of the total amounts given by the Brazilian government to Brazilian States. After a literature review, we discuss a model based on the Bergson-Samuelson function. We used official data (from the “Tesouro Nacional”) from January 1997 to March 2011 in order to study the decentralized grants. We also regress on other Brazilian time series in order to control for the effect of inequality series. By applying cointegration techniques and testing the causality direction, we conclude that there is statistical validation that as the distribution becomes more unequal, the total amounts of transferred grants increase.

JEL: H11, C22, H23.

Keywords : Distribution criteria; government transfers; decentralization.

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