Unbalanced Development and Regional Governments : How Much Equalize and How to Equalize?

The aim of the paper is to shed light on two key questions: How to equalize and how much equalize. In order to do it, a number of issues both political and economic must be previously examined. Moreover, while my interest concentrates into the third type of inter-territorial redistribution, discussion on fiscal equalization often mixes the effects involved by the other two. Hence the need of also dealing with then in what follows. The organization of the paper is the following. In section two relationships between equalization and inter-territorial redistribution with politics are analyzed. Section three is focused on the effects of equalization on efficiency and economic growth. Section four discusses a number of key issues for equalization formulas. Section five concludes