A Market for Local Taxes: Decentralization and Uncertainty

• In Event: Comparative Perspectives on Local Governance and Finance

Brief Overview

We use a policy reform in Japan to study how decentralization affects local fiscal capacity and public goods provision, finding that it boosts short-term welfare but also increases long-term uncertainty and encourages risk-averse decision-making.

Authors

• Anna Yorozuya, Yale University

• Charles McClean, Yale University