No. 153. THE IMPACT OF BELGIUM FEDERAL REFORM ON ECONOMIC WELL-BEING. A PARAMETRIC AND NON-PARAMETRIC SYNTHETIC CONTROL APPROACH
Al. Mitra, Ath. Chymis. 2019.
This paper applies both parametric and non-parametric synthetic control method in the case of a specific federal reform. It evaluates the impact of Belgium constitutional federalism reform of 1993 on GDP per capita. The findings show a negative impact of the reform on economic well-being. It is argued that the presence of a strong federalism with sub-national spending autonomy and, conversely, centralized tax system, has enhanced pork barrel spending, common-pool problem, thus damaging economic growth.