Public Sector Decentralization: Measurement Concepts and Recent International Trends

36 Pages Posted: 15 Oct 2004 Last revised: 15 Aug 2008

See all articles by Dan Stegarescu

Dan Stegarescu

Center for European Economic Research (ZEW)

Date Written: 2004


This paper deals with the problems encountered in defining and measuring the degree of fiscal decentralization. Drawing on a recent analytical framework of the OECD, different measures of fiscal autonomy and revenue decentralization are presented which consider tax-raising powers of sub-central governments. Taking account of changes in the assignment of decision-making competencies in the course of time, new time series of annual data on the degree of fiscal decentralization are provided for 23 OECD countries in the time period between 1965 and 2001. It is shown that common measures usually employed tend to considerably overestimate the extent of fiscal decentralization. Evidence is also provided for increasing fiscal decentralization in a majority of OECD countries during the last three decades.

Keywords: Fiscal Decentralization, Measurement of Decentralization, Sub-national Autonomy, Tax Autonomy

JEL Classification: H71, H72, H77

Suggested Citation

Stegarescu, Dan, Public Sector Decentralization: Measurement Concepts and Recent International Trends (2004). ZEW - Centre for European Economic Research Discussion Paper No. 04-074, Available at SSRN: or

Dan Stegarescu (Contact Author)

Center for European Economic Research (ZEW) ( email )

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