Abstract

CAMELO RINCON, Milton Samuel. FISCAL DECENTRALIZATION AND MACROECONOMIC STABILITY: A NONPARAMETRIC SIX LATIN AMERICANCOUNTRIES. Tend. [online]. 2013, vol.14, n.2, pp.163-183. ISSN 0124-8693.

This paper presents a statistical analysis about the relationship between fiscal decentralization and macroeconomic stabilization for a group of Latin American countries: Argentina, Mexico, Venezuela, Chile, Bolivia and Colombia. With this purpose, it uses two indicators of fiscal decentralization based on information from public spending and tax revenues, simultaneously considering the spatial structure of these governments - federal or unitary. From nonparametric statistical methods is evaluated whether measures of decentralization are somewhat related to some variables of macroeconomic stability, as predicted by some theoretical postulates of public finances, or otherwise, the territorial structure and fiscal decentralization are not significant policies of macroeconomic stabilization functions. The results suggest that the degree of decentralization is not so critical, however intermediate levels of decentralization are preferable that extreme ones. Additionally, there is a trend towards greater stability in nonfederal countries.

JEL Classification: C14; C12; E20; H7

Keywords : Fiscal Decentralization, Macroeconomic Stability, Nonparametric Statistic; Regression Splines; Growth..

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