Determinants of Public‐Sector Efficiency: Decentralization and Fiscal Rules

Christl, Michael; Köppl‐Turyna, Monika; Kucsera, Dénes

doi:10.1111/kykl.12224

Cited by 33 publications

(17 citation statements)

References 78 publications

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“…The theoretical-methodological basis of the research is the papers of various scientists on the research problem, where the inter-budgetary relations [13], financial mechanisms for the development of territorial units [14][15][16][17][18][19][20][21][22][23][24][25], the characteristics of state fiscal arrangement models are studied [26][27][28][29][30][31][32][33][34]. This includes works by Aidt and Dutta, Ehrlich, Enikolopov, Ejobowah, Gaizatullin, Kline, Sow, Staehr, and others [35][36][37][38].…”

Section: Literature Reviewmentioning

confidence: 99%

The intergovernmental relations and their regulation in the context of decentralization of fiscal policy

Abuselidze

2021

E3S Web Conf.

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The suspension of economic relations as a result of the global pandemic has severely affected the country’s peripheries. Unequal development of territorial units and overcoming socio-economic problems is the biggest challenge of any country. To address these challenges, the country needs to mobilize large amounts of finance and make optimal allocations. Intergovernmental relations play an important role in the effective implementation of the transformation of the country’s economic and political system. The aim of the paper is to study the characteristics of revenue mobilization and distribution between the levels of the fiscal system. There are developed some recommendations for improving inter-budgetary relations based on the experience of different countries. The recommendations proposed as a result of the research analysis can be used for both theoretical (for lecture) and practical (for legislative) purposes.

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Section: Literature Reviewmentioning

confidence: 99%

The intergovernmental relations and their regulation in the context of decentralization of fiscal policy

Abuselidze

2021

E3S Web Conf.

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“…5. Transfers, including, in particular, their link to per capita income, reduce the efficiency of local government spending (Boetti et al, 2012;Christl et al, 2020;Kalb, 2010). 6.…”

Section: The Framework For Financing Local Governments In the Light O...mentioning

confidence: 99%

Financing framework for local governments: diagnosis and change proposals

Karnowski

Rzońca

2021

EiP

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Motivation: The best way to widen access to public services at the local level is to increase efficiency of local government spending. However, an increase in efficiency may refer to output or inputs. In the latter case it does not widen access to public services. Moreover, factors conducive to spending efficiency may be detrimental to local cohesion. Finding a way so that the financing framework for local governments would reconcile the efficiency condition with the conditions of access to public services and local cohesion respectively, is an issue of great importance for economic policy. It seems to be so especially in a country like Poland, where there are large differences in the level of development between regions for historical reasons. These differences, if left accumulating, could easily jeopardize efficiency due to distorted capital flows, not to mention political tensions they may cause. Aim: The article aims at identifying basic features of the financing framework for local governments in Poland that hinder efficiency of their spending and at proposing feasible changes to that framework that would improve the efficiency but not at the expense of local cohesion or access to public services. Results: The article argues that the financing framework of local governments in Poland would better meet conditions of both efficiency and access to public services, if local governments relied mostly on revenues from income taxes instead of transfers from the central government, and some elements of tax competition between local authorities, although restricted to PIT-free allowance, were introduced. Such a shift in local governments revenue composition would not weaken local cohesion, if it was accompanied by an appropriate solidarity subvention financed by the richest voivodeship and the central government, and non-recurring central government revenues were allocated to investments exceeding financial capacity of local governments.

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“…To make public infrastructure projects successful, politicians' incentives must be improved and constraints must be changed. Economists have extensively analyzed federalism in the form of decentralization (see, among others, Oates, 1999;Eichenberger, 1994;Espasa et al, 2017, Christl et al, 2019 and direct democracy (see, among others, Frey, 1994;Matsusaka, 2005; as means to increase competition in politics and thereby align the incentives of politicians with the interests of the public. These two institutions serve as a standard explanation of Switzerland's success: It is highly decentralized and incorporates instruments of direct democracy at all layers of government.…”

Section: Get the Public In The Driver Seatmentioning

confidence: 99%

Making Public Infrastructure Work: Multi-seat Majoritarian Elections as a new Institutional Approach

Eichenberger

Schafer²,

Stadelmann

2019

J Infrastruct Policy Dev

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The wealth of nations depends on the quality of their infrastructure. Often, however, infrastructure suffers from ineffective investments and poor maintenance. Proposed solutions, such as New Public Management or Public-Private Partnerships (PPPs) tend to develop into Politicians-Private Partnerships as politicians collude with private firms to exploit present and future tax-payers. Therefore, it is necessary to give citizens better control over collective decision making. While there is a significant economic literature on empowering citizens via decentralization and direct democratic institutions, the role of electoral rules has thus far been rather neglected. An interesting case in point is Switzerland, which is well known for its high-quality infrastructure, extensive decentralization, and direct democracy. However, this paper argues that there is an additional and previously neglected institution that moves Swiss politicians away from client politics towards better serving public interest: Switzerland’s unique electoral institutions which effectively combine proportional elections with multi-seat majority elections. We explain how these institutions work, how they enhance the relationships between citizens and public and private entities, and we argue that they could be implemented in other countries.

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Determinants of Public‐Sector Efficiency: Decentralization and Fiscal Rules

Cited by 33 publications

References 78 publications

The intergovernmental relations and their regulation in the context of decentralization of fiscal policy

The intergovernmental relations and their regulation in the context of decentralization of fiscal policy

Financing framework for local governments: diagnosis and change proposals

Making Public Infrastructure Work: Multi-seat Majoritarian Elections as a new Institutional Approach

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