Abstract:The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Ba… Show more
“…The significant advantages of the metropolitan government approach are the internalizing of spillover effects, the built-in coordination in the delivery of functions, the better opportunity for capturing economies of 25 For discussions of metropolitan-area governance, see Bahl and Linn (1992), Bird and Slack (2004), Jouve and Lefèvre (2002), OECD (2006), Slack (2007) and Bahl (2013). scale, and the possibility for accessing a broad tax base in an efficient way.…”
“…The significant advantages of the metropolitan government approach are the internalizing of spillover effects, the built-in coordination in the delivery of functions, the better opportunity for capturing economies of 25 For discussions of metropolitan-area governance, see Bahl and Linn (1992), Bird and Slack (2004), Jouve and Lefèvre (2002), OECD (2006), Slack (2007) and Bahl (2013). scale, and the possibility for accessing a broad tax base in an efficient way.…”
“…Secondly, the local government should built sustainable markets, which will help contribute to increase in the amount of revenue collection (Slack, 2007). Since there is CIP in Mogadishu, the local government should therefore developmental projects, either large or small, with the aim of improving CIP to facilitate increase trust from the community; this way, the community will be willing to pay taxes to facilitate various projects (Schou, 2000).…”
Abstract. Local government that has power to self-finance promotes socioeconomic development and it creates an environments where local communities have access to get basic services and it also enhances the responsiveness of government to the citizens. There have been efforts of local government to finance itself but the struggle ended up expenditures exceeded than revenues and it was a time that the central government has not capacity to transfer funds to fill the balance gaps; the solution was reduction of local government spending (low salary/lack of salary of municipal servants) and decline of basic service deliveries.This paper examines the key current sources of financing local governments as well as the existing source of finance that were not being utilized yet due to prevailing challenges.The study explores the exercise and mechanisms of taxing system, revenues collection strategies, weak or lack of fiscal decentralization and incompetent collection enforcement. Somalia has not yet create up to date data base of taxable sources such as commercial, residential, and agricultural sectors and its difficult for the local government to promote self-financing strategies unless to remove barriers of classic by placing more sophisticated collection of revenue as well as creating new sources of finance.
“…In sum, let me return to and emphasize a common theme throughout: our theories provide some general guidance on how to provide infrastructure but little specific advice on the mechanics of infrastructure provision. In fact, Slack () believes that in a fundamental sense economics plays little role in many of these actual decisions: “… rarely are these economic principles used to determine the optimal government structure. More often, the structures that are imposed are dictated by politics, and not economics.…”
Section: Conclusion: Best Practices and A Way Forwardmentioning
confidence: 99%
“…In sum, let me return to and emphasize a common theme throughout: our theories provide some general guidance on how to provide infrastructure but little specific advice on the mechanics of infrastructure provision. In fact, Slack (2007) believes that in a fundamental sense economics plays little role in many of these actual decisions:…”
Section: Conclusion: Best Practices and A Way Forwardmentioning
Improved urban infrastructure is widely believed to be essential in facilitating economic growth and in improving the lives of urban dwellers, both in developed and in developing countries. This paper focuses on several dimensions of urban infrastructure finance: finance for major infrastructure improvements in major economic centers, finance for expansion of basic municipal services in secondary cities and towns, and intergovernmental systems for financing investments with impacts beyond jurisdictional limits. It reviews what is “known” about current practices in these areas, using international evidence and case studies and summarizing international best practices. It also indicates areas in which knowledge gaps remain. Despite these “unknowns,” there are avenues by which our understanding of infrastructure schemes can be enhanced, and some suggestions for a research agenda on financing urban infrastructure are offered in the concluding section.
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