Across the OECD, GDP per capita is converging. In contrast, regional disparities – or differences in GDP per capita across jurisdictions – are rising, mainly as a result of widening productivity differences. Fiscal decentralisation could help reduce them again. According to new OECD research, assigning more ownsource revenue to sub-national governments dampens regional GDP disparities and underpins regional convergence.
The papers providing background to this note are:
Fiscal decentralisation and income inequality: empirical evidence from OECD countries
Sibylle Stossberg, David Bartolini and Hansjörg Blöchliger
Fiscal decentralisation and regional disparities
David Bartolini, Sibylle Stossberg and Hansjörg Blöchliger
Regional GDP in OECD countries: how has inequality developed over time?
Felix Arnold and Hansjörg Blöchliger