Varieties of Decentralization, Institutional Complementarities, and Economic Growth: Evidence in OECD Countries

This chapter explores the impact of decentralization - articulated in all its forms - on economic growth for a sample of 20 OECD countries over the period 1973-2007. It aims at contributing to the existing literature in two ways. Firstly, it introduces the concept of institutional complementarities in order to take into account the various dimensions of decentralization - i.e. fiscal, political, and administrative - and their interactions. Secondly, it provides new empirical evidence on the mechanisms linking decentralization and economic growth, also by introducing a novel disaggregation of the conventional fiscal decentralization indices.