Fiscal decentralization and intergovernmental relations in transition economics : toward a systematic framework of analysis

摘要: The decentralization of government in Eastern Europe represents a reaction both from below (to tight central political control) and above privatize the economy relieve government's fiscal stress). In all transitional economies, developing structure intergovernmental relations is intimately related to such critical policy issues as privatization, stabilization, social safety net. sphere, tax reform, deficit control, finance are tripod. Unless each leg set up properly, whole could collapse. present strategy devolving expenditures downward while holding back on revenue flows transfers balance budget unlikely succeed for more than year or two at best. Net spending reductions subnational level may be difficult achieve. From 10 40 percent outlays go sector, many countries local governments provide much that makes pain economic transition politically tolerable. And, most housing enterprises have been shifted ownership, with maintenance subsidy cost this implies. Since sources assigned cannot expected levels activity, result shifting likely strong demands increased, rather decreased, transfers. Alternatively, look coping mechanisms their (which vital services), extrabudgetary revenues, borrowing. These threaten reduce budgetary transparency, impede stabilization policies. authors describe risks macroeconomic stability, an adequate net policies toward imply. Its themes sector needs realistically factored into national plans - clearly assessed. Such assessments acknowledge larger sphere need access robust sources. Giving share personal income one possible perhaps desirable approach meeting these revenues needs. Careful attention paid design implementation remain prominent features landscape years come. Caution also needed borrowing by government. Consolidating integrating funds (and national) crucial enhanced transparency macrostability.