Stimulating local economies through central transfers: A natural experiment from Ecuador
Journal of Development Economics · 2026 · Leonardo Sánchez-Aragón、Gonzalo E. Sánchez、Wladimir Zanoni
中文摘要
本文为发展中国家背景下中央对地方政府转移支付的经济影响提供了因果证据。我们利用2018年厄瓜多尔政府间分配公式改革所引致的市级转移支付的合理外生变异,采用基于设计的工具变量策略进行估计。结果表明,政府转移支付增加1%,使2018年企业销售总额增加0.94%,2019年增加1.05%。最强效应出现在非增值税销售额上。机制分析表明,转移支付主要通过增加经常性支出和资本性支出来促进地方经济活动,尤其是工资和采购支出,这说明设计良好的转移支付可以成为有效的地方需求刺激手段。
Abstract
This paper provides causal evidence on the economic impact of central-to-local government transfers in a developing country context. We exploit plausibly exogenous variation in municipal transfers generated by a 2018 reform to Ecuador’s intergovernmental allocation formula. Using a design-based instrumental variables strategy, we estimate that a 1% increase in government transfers led to a 0.94% increase in total business sales in 2018 and 1.05% in 2019. The strongest effects are found in non-VAT sales. Mechanism analysis shows that transfers boost local economic activity mainly through increased recurrent and capital spending, particularly wages and procurement, suggesting that well-designed transfers can act as effective local demand stimuli.