Does Fiscal Decentralization Affect Infrastructure Quality? An Examination of U.S. States

13 Pages Posted: 22 Feb 2018

See all articles by Monica Escaleras

Monica Escaleras

Florida Atlantic University - Department of Economics

Peter Calcagno

College of Charleston - Department of Economics

Date Written: April 2018

Abstract

A transportation network is vital to an economy. However, the U.S. highway infrastructure suffers from insufficient maintenance creating inefficiencies such as increased travel times and increase in accidents. The means to fund the infrastructure and their maintenance is a point of debate. In this paper, we examine the role of political institutions and decision‐making on the quality of highway infrastructure by focusing on the role of fiscal decentralization. Using generalized linear model estimation on state data from 1992 to 2012, we find evidence that fiscal decentralization improves infrastructure quality. These results are robust to the choice of control variables and method of estimation.

JEL Classification: D73, H42, H72

Suggested Citation

Escaleras, Monica and Calcagno, Peter, Does Fiscal Decentralization Affect Infrastructure Quality? An Examination of U.S. States (April 2018). Contemporary Economic Policy, Vol. 36, Issue 2, pp. 410-422, 2018, Available at SSRN: https://ssrn.com/abstract=3127877 or http://dx.doi.org/10.1111/coep.12258

Monica Escaleras (Contact Author)

Florida Atlantic University - Department of Economics ( email )

5353 Parkside Dr
Jupiter, FL 33458
United States

Peter Calcagno

College of Charleston - Department of Economics ( email )

66 George Street
Charleston, SC 29424
United States

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