Abstract

Research background: Despite of the universality of the implementation in democratic countries the principle of decentralization resulting from the belief that it is an instrument to improve the efficiency of public funds management, both the scope of public services and the level of decentralization in individual countries are not identical. Purpose of the article: Comparison the scope of fiscal decentralization in the countries of the European Union; identification the features of countries in which the average level of decentralization from the years 2013-2016 is similar. Methods: Cluster analysis method: hierarchical agglomeration method using full binding and Euclidean distance; measure of central tendency - arithmetic mean; data was obtained from Eurostat. Findings & Value added: It was found that in the European Union countries the level of the decentralization index is diversified. Its average value over the period considered (2013-2016) ranged from 0.55% (Malta) to 35.13% (Denmark). The research method used initially (cluster analysis) did not allow achieving the goal: the distances between bonds did not differ significantly, groups of objects could not be separated and grouped into clusters, therefore the dendrograms were not unambiguous. The creation of groups was possible thanks to the use of the second research method - the central tendency. After assuming that the distances between groups must be at least 1 percentage point, 4 groups of countries were created: low, medium, high and the highest degree of decentralization, with group II being the most numerous, with 17 countries with decentralization levels within the borders 6-12%. This group includes all federal states - EU members and most of the countries that joined the EU in 2004 or later. One of the exceptions is Poland - assigned to group III.

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