Forms of government that mix a central government with regional governments.
As a subfield of public economics, fiscal federalism is concerned with "understanding which functions and instruments are best centralized and which are best placed in the sphere of decentralized levels of government" (Oates, W.E. 1999. 'An Essay on Fiscal federalism', Journal of economic Literature, 37(3):1120-49 JSTOR).
This matters to politics in that it involves the distribution of government power.