scholarly journals Partial Fiscal Decentralization and Local Government Spending Policy

e-Finanse ◽  
2018 ◽  
Vol 14 (3) ◽  
pp. 21-31
Author(s):  
Agnieszka Kopańska
Keyword(s):  
Local Government ◽  
Basic Principle ◽  
Government Spending ◽  
Local Governments ◽  
Local Authority ◽  
Fiscal Decentralization ◽  
School Education ◽  
Financial Resources ◽  
Empirical Literature ◽  
Local Finance

AbstractThe aim of this paper is to analyze how limits in revenue and spending autonomy of sub-sovereign governments influence their decisions. Revenue and spending autonomy indicators for Polish towns were established and used in analysis on school education expenditures during 2003–2016. The influence of limits on revenue autonomy on municipal spending has been extensively addressed in both theoretical and empirical literature. However, studies related to spending autonomy are rare. The analysis presented in this paper suggests that when limits exist in spending autonomy, more decentralized tasks are crowded out by regulated obligations. That is why the spending autonomy analysis is important to evaluate the equity between local units and the adequacy of local revenues to decentralized expenditures.The basic principle of local finance is that there should be an adequate relationship between the financial resources available to a local authority and the tasks it performs. However, in practice, the assessment of whether this has been achieved is very difficult. Often, only problems with the solvency of local governments indicate that we are dealing with a poorly constructed system of local finances. The expenditure autonomy indicator proposed in this article is a tool that provides a way to indicate problems with the adequacy of revenues before such anextreme situation occurs.

scholarly journals Dampak Desentralisasi Fiskal terhadap Volatilitas Belanja Pemerintah Kabupaten/Kota di Indonesia

2019 ◽  
Vol 19 (1) ◽  
pp. 118-138
Author(s):  
Benedictus Raksaka Mahi ◽  
Syarah Siti Supriyanti
Keyword(s):  
Local Government ◽  
Government Spending ◽  
Local Governments ◽  
Central Government ◽  
Fiscal Decentralization ◽  
Government Transparency ◽  
Before And After

The volatility of expenditures sub-local derived from central government transparency in transfers to local governments may aggravate sublocal economy. This study aims to analyze the eect of fiscal decentralization to the level of volatility of local government spending in 230 sub-local in Indonesia. We use two periods, before and after the implementation of Law No. 28 Year 2009. The regression results indicate that the volatility of local government spending may decrease if the degree of fiscal decentralization increases, especially at the time when districts implement that law. As responsive taxation can provide incentives for smooth spending for sub-local government. ================================= Volatilitas belanja pemerintah kabupaten/kota yang berasal dari ketidakpastian transfer pemerintah pusat kepada pemerintah daerah dapat memperburuk perekonomian kabupaten/kota. Penelitian ini bertujuan menganalisis pengaruh desentralisasi fiskal terhadap tingkat volatilitas belanja riil pemerintah pada 230 kabupaten/kota di Indonesia serta membandingkan data sebelum dan sesudah implementasi UU No. 28 Tahun 2009. Hasil menunjukkan semakin tinggi derajat desentralisasi fiskal, cenderung menurunkan volatilitas belanja riil pemerintah kabupaten/kota karena kemampuan fiskal kabupaten/kota cenderung meningkat setelah implementasi UU tersebut. Pajak properti merupakan sumber penerimaan daerah yang dapat diprediksi sehingga pemerintah kabupaten/kota dapat mengelola belanja daerahnya dengan lebih pasti dan terukur.

THE EFFECT OF REVENUE SHARES ON LOCAL GOVERNMENT SPENDING: EVIDENCE FROM PHILIPPINE PROVINCES

2019 ◽  
pp. 1-35
Author(s):  
TRISTAN CANARE
Keyword(s):  
Local Government ◽  
Government Spending ◽  
Local Governments ◽  
Developing Economies ◽  
The Philippines ◽  
Government Expenditures ◽  
Empirical Literature ◽  
Marginal Effect ◽  
Fiscal Transfer ◽  
Local Government Expenditures

Intergovernmental fiscal transfer (IFT) is one of the several sources of funds of sub-national governments. There are two general types of IFT — conditional and unconditional. In many developing economies including the Philippines, the usual existing IFT is a form of unconditional fiscal transfer called revenue shares. In the Philippines, this revenue-sharing scheme is called the internal revenue allotment (IRA). Empirical literature says that unconditional IFTs are the type of fiscal transfers with the least effect on local government spending. The literature posits that the reason for this is that local governments use these transfers to substitute for own-sourced revenues such as local taxes. This explanation was formalized through a framework presented in this paper. Using panel data from Philippine provinces for the years 2001 to 2015, this paper attempted to determine the effect of revenue shares, in the form of IRA, on local government expenditures. Using different econometric methodologies, this paper arrived at several conclusions. First, IRA has a strong positive effect on total local government spending with a marginal effect slightly greater than one — much higher than what comparable studies found using data from other countries. Secondly, the effect of IRA on local government expenditures is even stronger for provinces with relatively greater ability to generate its own funds. Next, IRA and other externally sourced revenues have much stronger marginal effects on local government spending than do own-sourced revenues. Finally, IRA has widely varying effects on different components of local government expenditures.

scholarly journals THE PROBLEM OF THE POLITICAL AND FISCAL DECENTRALIZATION OF THE LOCAL GOVERNMENT IN 2012-2019

2019 ◽  
Vol 4 (7) ◽  
pp. 148-154
Author(s):  
ANA TSITLIDZE
Keyword(s):  
Local Government ◽  
Public Administration ◽  
Local Governments ◽  
Central Government ◽  
Fiscal Decentralization ◽  
Fundamental Principle ◽  
Financial Resources ◽  
Formal Control ◽  
Democratic State ◽  
Key Issues

The article contains a concept about Political and fiscal decentralization problem in Georgia during “2012-2019” For each democratic state strong local government and its political and fiscal decentralization is a fundamental principle of democracy. A local government is a form of public administration which, in a majority of contexts, exists as the lowest tier of administration within a given state. It contains political, fiscal and administration decentralization which means to transfer power from central government to municipality. In the way of Democracy and European integration as a still democracy development county, Local Government development and its Political and fiscal decentralization is an important and key issues for Georgia. Aim of the Article: To analyze the process and the problem of Political and Fiscal decentralization of Local Government in Georgia during 2012-2019. What type of problem we have and what is the main problem for Political and Fiscal decentralization of Local Government in Georgia. Despite all of reforms from independence to nowadays, political and fiscal decentralization of local Government is a problem for all governments in Georgia. The main reason for all of them was political control under the Local governments. After 2012, the hope that the new Government can implement real political da fiscal decentralization of local government was big. But reality is different. Despite two reforms of Local Government during 2012-2019, until now the problem of political and fiscal decentralization in Georgia is the same: no formal control of Local Governments, Most of Financial resources still have central Government, Local Governmnts have no possibility to implement their power independently, they have no own property and sufficient financial resources. In this article we give a recommendations how to improve political and fiscal decentralization aspects in Geogria and what the main problem is.

scholarly journals FEATURES OF INTER-BUDGETARY RELATIONS IN THE CONDITIONS OF DECENTRALIZATION OF POWER IN UKRAINE

2021 ◽  
pp. 154-163
Author(s):  
Igor Oliychenko ◽  
Maryna Ditkovska
Keyword(s):  
Local Government ◽  
Financial Literacy ◽  
Local Governments ◽  
Intergovernmental Relations ◽  
Fiscal Decentralization ◽  
Financial Resources ◽  
Intergovernmental Transfers ◽  
Resource Base ◽  
Public Authorities ◽  
Transfer Policy

The article examines the features of inter-budgetary relations in the context of decentralization of power as an important tool for the formation of local budgets and their effective implementation with limited financial resources. The authors considered the factors influencing the decentralization process such as the taxation system, transfer policy, giving greater powers to local governments in developing programs of socio-economic development and analyzed the sources of financial resources of the region, problems of their formation and use, revenues and expenditures last years. Decentralization reform has made it possible to increase the revenue side of local budgets and strengthen the financial and resource base of the regions, improve the use of intergovernmental transfers and diversify their sources. The study revealed the main problems of formation and use of financial resources of the region. These include inconsistencies in the movement of financial resources, tax pressure, various goals of economic entities and public authorities, low level of financial literacy of local government officials, inconsistencies in budget legislation, and lack of an effective mechanism for redistribution of state revenues. Among the ways to conduct budget decentralization and ensure the effectiveness of inter-budgetary relations, based on expanding the rights of local governments, strengthening their budgetary independence and responsibility, it is proposed to provide local authorities with opportunities for budgeting, redistribution of financial resources between public authorities, clear definition of local government and united territorial communities, application of modern methods of socialplanning, mechanisms of interaction of public authorities, enterprises, the attraction of investment resources through the development of local funds of regional development, granting to investors advantages, support of cooperation and interaction of enterprises, reduction of expenses for maintenance of public authorities, expansion sources of revenue to local budgets. The processes of fiscal decentralization must be constantly improved by overcoming the contradictions that arise in intergovernmental relations and modernizing the main institutions of the budget system.

scholarly journals Game Theory-Based Analysis of Local Governments’ Behavioral Dissimilation in the Third-Party Soil Pollution Control under Chinese-Style Fiscal Decentralization

Land ◽  
2021 ◽  
Vol 10 (4) ◽  
pp. 389
Author(s):  
Caihua Zhou
Keyword(s):  
Local Government ◽  
Soil Pollution ◽  
Pollution Control ◽  
Local Governments ◽  
Central Government ◽  
Fiscal Decentralization ◽  
Third Party ◽  
The Third ◽  
Party Control ◽  
The Third Party

The participation of a third party of the environmental service enterprise theoretically increases the level and efficiency of soil pollution control in China. However, Chinese-style fiscal decentralization may have a negative impact on the behaviors of participants, especially the local government. First, this paper conducts a positioning analysis on participants of the third-party soil pollution control in China and discusses the behavioral dissimilation of the local government under fiscal decentralization. Second, taking the government’s third-party soil pollution control as a case, a two-party game model of the central government and the local government is established around the principal-agent relationship, and a tripartite game model of the central government, the local government, and the third-party enterprise is designed around the collusion between the local government and the third-party enterprise. The results show that Chinese-style fiscal decentralization may lead to the behavioral dissimilation of local governments, that is, they may choose not to implement or passively implement the third-party control, and choose to conspire with third-party enterprises. Improving the benefits from implementing the third-party control of local governments and third-party enterprises, enhancing the central government’s supervision probability and capacity, and strengthening the central government’s punishment for behavioral dissimilation are conducive to the implementation of the third-party soil pollution control. Finally, this study puts forward policy suggestions on dividing the administrative powers between the central and local government in third-party control, building appraisal systems for the local government’s environmental protection performance, constructing environmental regulation mechanisms involving the government, market and society, and formulating the incentive and restraint policies for the participants in the third-party soil pollution control.

scholarly journals THE ROLE OF LOCAL GOVERNMENTS IN REGIONAL FINANCIAL MANAGEMENT FOR THE HANDLING OF THE COVID-19 PANDEMIC

Yurispruden ◽  
2021 ◽  
Vol 4 (2) ◽  
pp. 208
Author(s):  
Fahrul Abrori
Keyword(s):  
Local Government ◽  
Research Methods ◽  
Financial Management ◽  
Local Governments ◽  
Central Government ◽  
Fiscal Decentralization ◽  
The Government ◽  
The Stability ◽  
The Relationship

 ABSTRAKPandemi Covid-19 yang terjadi di Indonesia membuat pemerintah membuat kebijakan-kebijakan sebagai stimulus untuk menjaga kestabilan masyarakat dan perekonomian. Pemerintah pusat memberikan kewenangan kepada pemerintah daerah untuk mengelola keuangan daerah untuk menangani covid-19 di daerah masing-masing. Hal ini disebabkan karena pemerintah daerah lebih memahami kebutuhan daerahnya. Permasalahan yang diangkat Pertama, bagaimana hubungan Pemerintah Pusat dan Pemerintah Daerah dalam pengelolaan keuangan untuk penanganan pandemi Covid-19? Kedua, Apa peran Pemerintah Daerah dalam pengelolaan keuangan daerah untuk penanganan pandemi Covid-19? Menggunakan metode penelitian yuridis normatif dengan pendekatan perundang-undangan dan pendekatan konsep. Hubungan Pemerintah Pusat dan Pemerintah Daerah dalam Pengelolaan Keuangan untuk Penanganan Pandemi Covid-19 yaitu desentralisasi fiskal yang mana. Peran Pemerintah Daerah dalam Pengelolaan Keuangan Daerah untuk Penanganan Pandemi Covid-19 yaitu dengan melakukan refocusing kegiatan, realokasi anggaran, dan Penggunaan Anggaran Pendapatan dan Belanja Daerah.Kata kunci: Pemerintah Daerah, Pengelolaan Keuangan Daerah, Pandemi Covid-19 ABSTRACTThe Covid-19 pandemic in Indonesia led the government to make policies as a stimulus to maintain the stability of society and the economy. The central government authorizes local governments to manage local finances to deal with covid-19 in their respective regions. This is because the local government better understands the needs of the region. The issue raised first, how is the relationship between the Central Government and Local Government in financial management for the handling of the Covid-19 pandemic? Second, What is the role of local governments in regional financial management for the handling of the Covid-19 pandemic? Using normative juridical research methods with statutory approaches and concept approaches. The relationship between the Central Government and Local Government in Financial Management for the Handling of the Covid-19 Pandemic is fiscal decentralization. The role of local governments in regional financial management for the handling of the Covid-19 pandemic is by refocusing activities, reallocating budgets, and using regional budgets.Keywords: Local Government, Regional Financial Management, Covid-19 Pandemic

Fiscal Decentralization and Local Borrowing in Turkish Provinces

2016 ◽  
pp. 505-519
Author(s):  
Mehmet Serkan Tosun ◽  
Dilek Uz ◽  
Serdar Yılmaz
Keyword(s):  
Local Government ◽  
Spatial Econometrics ◽  
Local Governments ◽  
Fiscal Decentralization ◽  
Cross Sectional ◽  
Turkish Republic ◽  
Government Structure ◽  
History Of ◽  
The Government ◽  
Government Reforms

There have been important developments in the decentralization of the government structure in Turkey since the early 1980s. This paper examines the link between fiscal decentralization and local borrowing within Turkish provinces. It first discusses local government reforms throughout the history of the Turkish Republic with the focus on recent reform efforts and current local government structure. It then provides an empirical analysis of the effects of decentralization in Turkish provinces using cross-sectional and panel data approaches, and spatial econometrics. The dataset consists of 67 provinces from 1980 to 2000, and separately cross-sectional data on all 81 provinces for the year 2000. Using decentralization measures such as number of local governments per capita and ratio of own-source municipal revenue to total provincial tax revenue, and specific characteristics of the municipalities the analysis examines whether variations in local decentralization across these provinces and across time have had a significant impact municipal borrowing in those provinces.

Nature over Art: No More Local Finance

1953 ◽  
Vol 47 (2) ◽  
pp. 461-477
Author(s):  
Rowland Egger
Keyword(s):  
Local Government ◽  
Local Governments ◽  
Alexis De Tocqueville ◽  
Intergovernmental Transfers ◽  
Government Finance ◽  
Absolute Increase ◽  
Local Finance ◽  
Local Government Finance ◽  
Four Score ◽  
The Absolute

In 1866 an uncommonly knowledgeable gentleman, Alexis de Tocqueville by name, wrote as follows: “Je pense que dans les siècles démocratiques qui vont s'ouvrir l'indépendence individuelle et les libertés locales seront toujours un produit de l'art. La centralisation sera le gouvernement naturel.” Four score and five years later a distinguished compatriot documented the triumph of nature over art which de Tocqueville contemplated as a possibility, and analyzed at some length the instrumentality through which le gouvernement naturel has established its primacy over les libertés locales. Professor Jean Boulouis has recently pronounced a plaintive requiem for French local self-government culminating in these words: “On pourrait presque avancer, sans beaucoup d'exagération, qu'il n'existe plus de finances locales, mais tout au plus une localisation des finances nationales.”The two most striking phenomena of local government finance in recent decades are, first, the absolute increase in the amount of money disbursed by local governments, and second, the substantial expansion in the proportion of local government disbursements financed from intergovernmental transfers of funds—grants-in-aid, shared taxes, and various other devices by which money is shifted from one level of government to another.

Comparison of Fiscal Decentralization Systems in EU-27 According to Selected Criteria

2013 ◽  
Vol 11 (3) ◽  
pp. 651-672 ◽  
Author(s):  
Mateja Finžgar ◽  
Žan Jan Oplotnik
Keyword(s):  
Public Finance ◽  
Comparative Analysis ◽  
Social Security ◽  
Fiscal Decentralization ◽  
Financial Resources ◽  
Healthcare Administration ◽  
Political Systems ◽  
Basic Principles ◽  
Local Finance

The paper deals with comparison of fiscal decentralization systems in EU-27 according to selected quantitative criteria and certain European Charter of Local Self-Government principles. The results of comparative analysis show that a higher number of lower levels of government usually indicate a greater share of local finance within the total public finance, however, this finding does not confirm the inverse link. Even though the structure of expenditures in EU-27 countries is quite similar, the shares of funds for the implementation of individual tasks and competencies differ significantly from country to country. On average, the countries allocate most funds to education, social security, healthcare, administration and political systems, with only a quarter of the countries recording the same or higher amounts of revenues than expenditures. Most of the countries still cover the existing deficit either through transfers from the central to lower levels of government or through equalisation schemes or borrowing, which otherwise represents a departure from one of the basic principles of the Charter, which stipulates that financial resources must be commensurate with the responsibilities of local self-government.

scholarly journals Adapting Public Sector Services to Local Delivery

2012 ◽  
Vol 17 (Special Edition) ◽  
pp. 359-385 ◽  
Author(s):  
Ishrat Husain
Keyword(s):  
Local Government ◽  
Service Delivery ◽  
Public Service ◽  
Local Governments ◽  
Business Processes ◽  
Civil Service ◽  
Fiscal Decentralization ◽  
Education And Health ◽  
Number Of Factors ◽  
Management Policies

This article describes the local government system established in the 2001 Devolution Plan and its evolution over the period 2002-07, with a focus on two essential public services, education and health. We believe that the devolution of service delivery functions, delegation of financial powers, decentralization of authority, and deconcentration of executive powers, can, together, lead to better accountability of results and, hence, to improved public service delivery to the poor and marginalized. The Devolution Plan made inroads toward these goals, particularly in education, but their achievement was incomplete due to a number of factors, among those incomplete fiscal decentralization, limited targeting of backward areas, and centralizing tendencies of the provincial departments and civil service. Recommendations are offered on how to further develop the local government system more generally, with an eye towards increasing accountability and improving coordination both across local governments and between tiers. For this, complementary reforms to simplify business processes and revamp human resource management policies are needed; introducing a district level civil service is among the suggested changes. The article concludes with detailed recommendations on improving the decentralized delivery of education and health services.

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