We study the effect of international trade and freeness of trade (openness) on interregional inequality within countries. We estimate a model derived from a structural economic-geography approach in which interregional inequality depends on weighted trade shares and trade costs. In addition to...

This paper provides a new data set of regional income inequalities within countries based on satellite nighttime light data. We first empirically study the relationship between luminosity data and regional incomes for those countries where regional income data are available. We subsequently use...

This paper analyzes the impact of political and fiscal decentralization on regional inequalities using a unique data set which covers 56 countries at different stages of economic develop-ment. Cross-section and panel data estimations show that decentralization decreases regional inequalities in...

This paper studies the hypothesis of an inverted-U-shaped relationship between spatial inequality and economic development. The theory of Kuznets (1955) and Williamson (1965) suggests that (spatial) inequality first increases in the process of development, then peaks, and then decreases. To test...

This paper studies the impact of decentralization on the shadow economy. We argue that decentralization may decrease the size of the shadow economy mainly through two transmission channels: (1) Decentralization enhancing public sector efficiency (efficiency effect), and (2) decentralization...

This paper studies the influence of interregional inequality within countries on internal con-flicts. Regional inequalities are measured by the population-weighted coefficient of variation of regional GDP per capita. As the main innovation, I use a panel data set of country-level re- gional...

The majority of theoretical and empirical studies on the relationship between decentralization and corruption argues that the devolution of power might be a feasible instrument to keep corruption at bay. We argue that this result crucially depends on the effectiveness of monitoring...

Foreign direct investments (FDI) are an important determinant of economic growth. Coun-tries try to attract mobile capital in order to foster economic development, albeit FDI might increase regional inequality since the many different regions of a country usually do not receive FDI in equal...

This paper examines whether the federal structure of aid-receiving countries matters in explaining aid effectiveness. Following the decentralization theorem, the devolution of powers should increase aid effectiveness, since local decision-makers are better informed about local needs. At the same...

This paper empirically studies the impact of decentralization on foreign aid effectiveness. For this purpose, we examine a commonly used empirical growth model, considering aid modality as well as different measures of political and fiscal decentralization. Our panel estimations reveal that...