FISCAL DECENTRALISATION AND INCLUSIVE GROWTH IN ASIA.

Preface
Foreword
Executive summary
1.  Decentralisation in a globalised world: Consequences and opportunities
	1.1. Introduction
	1.2. Decentralisation in heterogeneous federations
	1.3. Challenges of globalisation for decentralisation
	1.4. Future reforms and research
	References
2.  A global view of sub-national governments in Asia:  Structure and finance
	2.1. Introduction
	2.2. Overview of the Asia-Pacific region: A highly diverse group of countries that face common decentralisation challenges
		2.2.1. Asia-Pacific countries are socially and economically diverse
		2.2.2. Sub-national government structures are very diverse across and within countries
		2.2.3. Decentralisation has become a primary goal of reform agendas in the Asia-Pacific region
		2.2.4. Assignment of responsibilities varies across and within countries, resulting in asymmetric decentralisation
	2.3. Sub-national governments are key social and economic actors in the Asia-Pacific region
		2.3.1. Asia-Pacific sub-national spending is significant on average, but uneven across countries and in terms of decision-making authority
		2.3.2. Spending and income ratios are not correlated in the Asia-Pacific region
		2.3.3. Administration, education and economic affairs/transport are the three priority spending areas
		2.3.4. Asia-Pacific sub-national governments are key public investors
	2.4. The level of sub-national tax revenue is high but uneven, and there are still significant fiscal imbalances in the Asia-Pacific region
		2.4.1. Tax revenue is the first source of revenue in the Asia-Pacific region before grants and subsidies
		2.4.2. Tax revenue comes mainly from shared taxation in several countries
		2.4.3. There are large fiscal imbalances between expenditure and tax revenue
	2.5. Sub-national government debt is high by international comparisons in the Asia-Pacific region
	2.6. Conclusion
	Notes
	References
3.  Fiscal decentralisation and inclusive growth:  The role of institutional context in selected Asian economies
	3.1. Introduction
	3.2. Basic intergovernmental institutional structures
	3.3. Decentralisation policy basics
	3.4. Sub-national powers and functions
	3.5. Sub-national autonomy
	3.6. Sub-national political mechanisms
	3.7. Access to information and civic engagement
	3.8. Conclusion
	Notes
	References
4.  Public policy for a modernising China: The challenge of providing universal access to education under fiscal decentralisation
	4.1. Introduction
	4.2. Background on China’s urbanisation during the early transition period
	4.3. Fiscal decentralisation in China and the financing framework for basic education
	4.4. The evolution of education policies for migrant children in China
		4.4.1. Phase 1: The 1990s
		4.4.2. Phase 2: 2001-05
		4.4.3. Phase 3: 2006 – Toward inclusive education
	4.5. Changes in the financing of education in China since 2000
	4.6. Conclusion
	Notes
	References
5.  Inclusive growth and fiscal decentralisation in Japan:  Current state and challenges
	5.1. Introduction
	5.2. Economic growth, income inequality, and fiscal decentralisation
		5.2.1. The effect of decentralisation on economic growth
		5.2.2. The effect of decentralisation on income inequality
		5.2.3. The effects of decentralisation and country-specific factors
	5.3. Fiscal decentralisation in Japan
		5.3.1. The Japanese system of local public finance
		5.3.2. Decentralisation reforms since 2000
		5.3.3. The role of Japan’s local governments in social protection
		5.3.4. Financing decentralised social expenditures
	5.4. Challenges: Constraints on inclusion and growth in Japan
		5.4.1. Japan’s ageing population, and rising regional disparities
		5.4.2. Growth through agglomeration and compactisation
	5.5. Conclusion
	Notes
	References
6.  Inclusive growth and decentralisation in Korea
	6.1. Introduction
	6.2. Literature review
	6.3. Education finance, performance and inequality in OECD and Asian countries
	Fiscal decentralisation and education equality in OECD countries
		Data and hypotheses
		The effect of fiscal decentralisation on resilient students in OECD countries
	The effect of regional disparities on the Gini coefficient in OECD countries
	Policy suggestions for inclusive growth through fiscal decentralisation
		Discussion and policy suggestions
		Limitations and further study
	References
7.  Decentralisation to promote regional development in Indonesia
	7.1. Introduction
	7.2. Progress in regional development has been mixed
		7.2.1. Health
		7.2.2. Education
	7.3. Regional administrative fragmentation continues apace
	7.4. Some fiscal aspects of decentralisation could be improved
		7.4.1. The General Allocation Fund
		7.4.2. The Specific Allocation Fund
		7.4.3. Autonomy transfers
		7.4.4. The Revenue Sharing Fund
		7.4.5. Village-level transfers
	7.5. Strengthening revenue raising in the regions
	7.6. Imprecise division of responsibilities across levels of government
	References
8.  Strengthening the internal revenue allotment system towards greater equity in the Philippines
	8.1. Introduction
		8.1.1. Overview
		8.1.2. Framing the discussion
		8.1.3. The income and poverty status of Philippine local governments
	8.2. Inclusive growth
	8.3. Internal revenue allotment
	8.4. IRA mandatory allocations: Do they promote inclusive growth?
	8.5. Summary of findings and conclusion
	Notes
	References
9.  Fiscal federalism in the Russian Federation and its Asian regions
	9.1. Introduction
	9.2. Basic features of Russian fiscal federalism
		9.2.1. Revenue side of Russia’s fiscal federalism
		9.2.2. Federal transfers
		9.2.3. Intra-regional fiscal relations
		9.2.4. The spending side of Russia’s fiscal federalism
		9.2.5. Sub-national fiscal rules
	9.3. Russian fiscal federalism and its impact on growth and inequality
		9.3.1. Growth is uneven across Russian regions
		9.3.2. Transfers and sub-national governments’ economic and fiscal incentives
		9.3.3. Transfers and economic growth
		9.3.4. Decentralisation to the local level
	9.4. The effects of Russian fiscal federalism on regional inequality
		9.4.1. Inter-regional disparities are no longer declining
		9.4.2. Transfers have an equalising effect
	9.5. Conclusion
	Notes
	References
		Annex 9.A. Technical annex
	Calculation of the tax potential of a region
	Description of regression specifications
	Panel data growth regressions
	Adjustments for IBEs
	Notes
10.  Fiscal decentralisation and governance in Thailand
	10.1. Fiscal Decentralisation and governance in Thailand
		10.1.1. The administrative structure of Thai local governments and the context of fiscal relations
		10.1.2. Expenditure assignment of Thai local governments
		10.1.3. The analysis of local expenditure allocation in Thailand
		10.1.4. Revenue assignment of Thai local governments
		10.1.5. Analysis of local government revenue allocation in Thailand
		10.1.6. Local government debt in Thailand
		10.1.7. Fiscal decentralisation: challenges for inclusive growth
	Notes
	References