This paper discusses the fiscal impact of the COVID-19 crisis across levels of government. It contrasts the composition of revenues and expenditures of different levels of government and their main institutional differences. For revenues, an error correction model is used to estimate the short-term elasticities of different levels of government, showing that subnational governments’ (SNGs) revenues are less sensitive to economic downturns than central governments’, mostly because SNGs tend to rely more on recurrent taxes on immovable property. For expenditures, central governments are often responsible for the bulk of expenditure on social protection, while SNGs have a higher investment-to-revenue ratio. The combination of these differences of expenditure assignment with the substantial budget and borrowing constraints that SNGs face creates a tendency towards pro-cyclicality at the subnational level and counter-cyclicality at the central level. Furthermore, in the context of the COVID-19 crisis, in order for SNGs to have the fiscal capacity for necessary measures to tackle the outbreak, central governments supported SNGs mostly through intergovernmental grants. As a consequence, central governments have absorbed most of the shock. Supplementary Information The online version contains supplementary material available at 10.1007/s10368-021-00518-1.
Neste trabalho, fazemos um conjunto de análises que procuram esclarecer os efeitos fiscais das emancipações municipais ocorridas após a aprovação da Constituição Federal de 1988 no Brasil. Nossos resultados indicam que a criação de novos municípios potencialmente contribuiu para o crescimento econômico das áreas rurais do país, no entanto, podem também ter aumentado a ineficiência na provisão de serviços públicos locais. Ficou evidenciado, por meio do uso de uma técnica de pareamento simples, que os municípios que passaram por um processo de subdivisão apresentaram maiores despesas que os demais, e que o financiamento dessas despesas foi feito com base em receitas não próprias. Por último, a partir de um conjunto de modelos de regressão linear, estimamos em 25 bilhões de reais o acréscimo nos gastos públicos resultante destas emancipações.
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