Do intergovernmental transfers reduce revenues collected by local government authorities (LGAs)? There is already a well-established body of literature in public finance, which argues that intergovernmental grants 'crowd out' local revenues. Most existing studies, however, explore the fiscal...

This paper provides an empirical analysis on the question whether equalization payments across regions and transfers from the central government stimulate regional growth or impede it. Using a panel of 22 French regions from 2002 to 2008, we find that regional economic growth is positively...