Spatial analysis of the effect of financial decentralization on the misery index (Iranian provinces)

In recent decades, different economies have experienced more financial decentralization policies than ever before. The reason for the increasing tendency of countries towards financial decentralization can be attributed to various goals such as increasing efficiency, reducing inflation, reducing unemployment, increasing economic growth, and so on. Therefore, the present study in the form of a spatial modeling seeks to answer the question that in the Iranian economy, by implementing policies of financial decentralization and transfer of power to the provinces, we can see a decrease in the misery index?The results of model evaluation estimated for the period 2006-2016 show that the effect of financial decentralization of expenditures and financial decentralization of income on the misery index of Iranian provinces has been positive, with a one percent increase in decentralization indices. Financial expenses and income increase the misery index by 0.061 and 0.063 percent, respectively.These results mean that the implementation of decentralization policies in the country can be accompanied by an increase, albeit a small one, in the index of economic misery. The analysis of the mentioned results indicates that in the developing country of Iran, decentralization will increase the differences between the regions, which indicates the inability of provincial governments to manage the resources allocated to them. Other findings of the article also indicate the positive effects of per capita income and annual population growth rate on the misery index. Per capita income coefficients and population growth rates were 0.18 and 0.016, respectively. In addition, the estimated coefficient for the literacy rate was -2.96%.