Federalism, Party Competition and Budget Outcome: Empirical Findings on Regional Health Expenditure in Italy

Giardina, Emilio and Cavalieri, Marina and Guccio, Calogero and Mazza, Isidoro (2009): Federalism, Party Competition and Budget Outcome: Empirical Findings on Regional Health Expenditure in Italy.

Abstract

In the last decade, Italy has experienced a considerable decentralization of functions to the regions. This transformation has been especially relevant for the National Health System that has de facto assumed a federal system design. The federal reform aimed at disciplining public health expenditure, which drains a substantial share of the budget of Italian regions and is among the main causes of the regional deficits. Political economic analysis, however, suggests that impact of federalism on public expenditure depends on central and local government strategies to win in the electoral competition. Results derived in this preliminary study indicate that political competition actually works as a tool of fiscal discipline; it shows a restraining effect on public health expenditure.

• Item Type: MPRA Paper
• Language: English
• Keywords: Fiscal federalism; local budget; multi-level policy-making; public expenditure; political competition; health economics
• Subjects: H - Public Economics > H5 - National Government Expenditures and Related Policies > H51 - Government Expenditures and Health; H - Public Economics > H7 - State and Local Government ; Intergovernmental Relations > H72 - State and Local Budget and Expenditures; I - Health, Education, and Welfare > I1 - Health > I18 - Government Policy ; Regulation ; Public Health; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D78 - Positive Analysis of Policy Formulation and Implementation; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D72 - Political Processes: Rent-Seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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