Regulatory decentralization and food safety: evidence from China
利用中国将食品加工制造监管权从省级下放至市级的自然实验，发现分权使食品安全事件平均减少51%，主要通过纠正信息不对称和增加地方法规实现。
Abstract It is not clear, a priori, whether a centralized or decentralized institutional arrangement is better at providing public goods. This study investigates how decentralization of regulatory authority affects public good provision, focusing on food safety. Using a natural experiment that transfers food safety regulatory authority over the food processing and manufacturing sector from provincial to city‐level governments, we find a 51% decrease in the average number of food safety incidents within cities that experienced the decentralization reform. Decentralization reduces food safety incidents by rectifying information asymmetry in food safety regulations and by increasing local food safety laws and regulations. Additional analyses show that decentralization primarily improves the food safety of larger and more experienced firms, and it has not harmed the total revenue of large‐scale food processing and manufacturing firms. Our study demonstrates the importance of information available to regulatory authorities in food safety regulation and highlights the role of local information in the decentralized provision of public goods.