Fiscal Decentralization in Developing and Transition Economies: Progress, Problems, and the Promise
The author discusses the revolution in public sector thinking that is transforming the public sectors of developing and transition countries. Countries are reconsidering their fiscal systems and searching for the right balance between central gover...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, D.C.
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2004/04/4125854/fiscal-decentralization-developing-transition-economies-progress-problems-promise http://hdl.handle.net/10986/14114 |
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okr-10986-14114 |
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| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ACCOUNTABILITY ALLOCATION OF RESOURCES ALLOCATION OF RESPONSIBILITIES ASSIGNMENT OF EXPENDITURES ASSIGNMENT OF TAXES AUTHORITY BENEFIT AREA CENTRAL BANKS CENTRAL GOVERNMENT CENTRAL GOVERNMENTS CENTRAL PLANNING CITIZENS CIVIL SERVICE COLONIALISM COLONIES COMPLIANCE COSTS CONSTITUTION CORRUPTION DECISION MAKING DECONCENTRATION DEFICITS DEMOCRACY DEMONSTRATION EFFECTS DEVOLUTION DISTRIBUTION OF INCOME DIVISION OF POWERS DRINKING WATER ECONOMIES OF SCALE ECONOMIES OF SCOPE ELECTED OFFICIALS EMPIRICAL EVIDENCE ENVIRONMENTAL POLICY EVASION EXPENDITURE EXPENDITURE ASSIGNMENT EXPENDITURE ASSIGNMENTS EXPENDITURE RESPONSIBILITIES FEDERAL GOVERNMENT FEDERALISM FINANCIAL CAPACITIES FINANCIAL CRISES FINANCIAL TRANSACTIONS FISCAL FISCAL CAPACITIES FISCAL DECENTRALIZATION FISCAL DISCIPLINE FISCAL EQUALIZATION FISCAL EQUITY FISCAL FEDERALISM FOREIGN DIRECT INVESTMENT FUEL TAXES GARBAGE COLLECTION GENERAL ELECTIONS GOOD GOVERNANCE GOVERNMENT EXPENDITURES GOVERNMENT FINANCE GOVERNMENT RESPONSIBILITY GOVERNMENT REVENUE GOVERNMENT ROLE GRANT DESIGN HEALTH EXPENDITURES HEALTH SPENDING HOUSING INSTITUTIONAL MECHANISMS LAND TAXES LEGAL FRAMEWORK LEGISLATION LEGISLATIVE BODIES LEVELS OF GOVERNMENT LOCAL AUTONOMY LOCAL GOVERNMENT LOCAL GOVERNMENT FUNCTIONS LOCAL GOVERNMENT INSTITUTIONS LOCAL GOVERNMENTS MANDATES MARGINAL COSTS MIGRATION MOTIVATIONS NATIONAL EXPENDITURES NATIONAL GOVERNMENTS NATIONAL LEVEL NATIONAL OBJECTIVES NATIONALIZATION NATIONS POLITICAL REFORMS PRIVATE SECTOR PRIVATE SECTOR PARTICIPATION PROVINCIAL GOVERNMENTS PROVISIONS PUBLIC EXPENDITURES PUBLIC GOODS PUBLIC GOVERNANCE PUBLIC HEALTH PUBLIC MANAGEMENT PUBLIC PARTICIPATION PUBLIC SECTOR PUBLIC SECTOR EXPENDITURES PUBLIC SECTOR PERFORMANCE PUBLIC SECTOR REFORM PUBLIC SERVICE PUBLIC SERVICE DELIVERY PUBLIC SERVICES REGULATORY OVERSIGHT REPRESENTATIVE GOVERNMENT REVOLUTION RISK MANAGEMENT SALES TAXES SOCIAL POLICY SOCIAL SAFETY SOCIAL SAFETY NETS SOCIAL SERVICES STATE ENTERPRISES SUBSIDIARITY PRINCIPLE TAX TAX SYSTEM TAXATION TECHNICAL ASSISTANCE TELECOMMUNICATIONS TOTAL EXPENDITURES TRANSITION ECONOMIES UNFUNDED MANDATES URBAN TRANSPORTATION VOTING TRANSITION ECONOMIES LOCAL GOVERNMENT SIZE GOVERNANCE DECENTRALIZATION SERVICE DELIVERY FISCAL ADMINISTRATION TAXES JUDICIAL ACCOUNTABILITY DEMOCRATIC LOCAL GOVERNANCE |
| spellingShingle |
ACCOUNTABILITY ALLOCATION OF RESOURCES ALLOCATION OF RESPONSIBILITIES ASSIGNMENT OF EXPENDITURES ASSIGNMENT OF TAXES AUTHORITY BENEFIT AREA CENTRAL BANKS CENTRAL GOVERNMENT CENTRAL GOVERNMENTS CENTRAL PLANNING CITIZENS CIVIL SERVICE COLONIALISM COLONIES COMPLIANCE COSTS CONSTITUTION CORRUPTION DECISION MAKING DECONCENTRATION DEFICITS DEMOCRACY DEMONSTRATION EFFECTS DEVOLUTION DISTRIBUTION OF INCOME DIVISION OF POWERS DRINKING WATER ECONOMIES OF SCALE ECONOMIES OF SCOPE ELECTED OFFICIALS EMPIRICAL EVIDENCE ENVIRONMENTAL POLICY EVASION EXPENDITURE EXPENDITURE ASSIGNMENT EXPENDITURE ASSIGNMENTS EXPENDITURE RESPONSIBILITIES FEDERAL GOVERNMENT FEDERALISM FINANCIAL CAPACITIES FINANCIAL CRISES FINANCIAL TRANSACTIONS FISCAL FISCAL CAPACITIES FISCAL DECENTRALIZATION FISCAL DISCIPLINE FISCAL EQUALIZATION FISCAL EQUITY FISCAL FEDERALISM FOREIGN DIRECT INVESTMENT FUEL TAXES GARBAGE COLLECTION GENERAL ELECTIONS GOOD GOVERNANCE GOVERNMENT EXPENDITURES GOVERNMENT FINANCE GOVERNMENT RESPONSIBILITY GOVERNMENT REVENUE GOVERNMENT ROLE GRANT DESIGN HEALTH EXPENDITURES HEALTH SPENDING HOUSING INSTITUTIONAL MECHANISMS LAND TAXES LEGAL FRAMEWORK LEGISLATION LEGISLATIVE BODIES LEVELS OF GOVERNMENT LOCAL AUTONOMY LOCAL GOVERNMENT LOCAL GOVERNMENT FUNCTIONS LOCAL GOVERNMENT INSTITUTIONS LOCAL GOVERNMENTS MANDATES MARGINAL COSTS MIGRATION MOTIVATIONS NATIONAL EXPENDITURES NATIONAL GOVERNMENTS NATIONAL LEVEL NATIONAL OBJECTIVES NATIONALIZATION NATIONS POLITICAL REFORMS PRIVATE SECTOR PRIVATE SECTOR PARTICIPATION PROVINCIAL GOVERNMENTS PROVISIONS PUBLIC EXPENDITURES PUBLIC GOODS PUBLIC GOVERNANCE PUBLIC HEALTH PUBLIC MANAGEMENT PUBLIC PARTICIPATION PUBLIC SECTOR PUBLIC SECTOR EXPENDITURES PUBLIC SECTOR PERFORMANCE PUBLIC SECTOR REFORM PUBLIC SERVICE PUBLIC SERVICE DELIVERY PUBLIC SERVICES REGULATORY OVERSIGHT REPRESENTATIVE GOVERNMENT REVOLUTION RISK MANAGEMENT SALES TAXES SOCIAL POLICY SOCIAL SAFETY SOCIAL SAFETY NETS SOCIAL SERVICES STATE ENTERPRISES SUBSIDIARITY PRINCIPLE TAX TAX SYSTEM TAXATION TECHNICAL ASSISTANCE TELECOMMUNICATIONS TOTAL EXPENDITURES TRANSITION ECONOMIES UNFUNDED MANDATES URBAN TRANSPORTATION VOTING TRANSITION ECONOMIES LOCAL GOVERNMENT SIZE GOVERNANCE DECENTRALIZATION SERVICE DELIVERY FISCAL ADMINISTRATION TAXES JUDICIAL ACCOUNTABILITY DEMOCRATIC LOCAL GOVERNANCE Shah, Anwar Fiscal Decentralization in Developing and Transition Economies: Progress, Problems, and the Promise |
| geographic_facet |
Africa Europe Latin America |
| relation |
Policy Research Working Paper;No.3282 |
| description |
The author discusses the revolution in
public sector thinking that is transforming the public
sectors of developing and transition countries. Countries
are reconsidering their fiscal systems and searching for the
right balance between central government control and
decentralized governance. Political decentralization has
advanced in most countries. Subnational expenditures in
developing countries as a percentage of total public
expenditures have also increased over the past two decades.
However, the process is far from complete. In many
countries, the central government is still involved in the
delivery of local services, local governments have few
sources of own-revenues, local governments have limited
access to borrowing for capital projects, and the design of
intergovernmental transfers does neither address regional
fiscal equity nor convey appropriate incentives for fiscal
discipline, improved service delivery performance, and
accountability to citizens. Decentralized public governance
can help realign public sector incentives through greater
accountability to citizens, and attenuate the
"democracy deficit" caused by globalization and
the role of supranational institutions and regimes. However,
this requires careful examination of the entire fiscal
system. Elements of a comprehensive package of fiscal system
reforms would include: (a) Clarifying roles of various
levels of government in public service delivery; (b)
Reassigning taxing responsibilities to ensure local revenue
autonomy, accountability, and efficiency without endangering
an internal common market; (c) Designing fiscal transfers to
ensure regional fiscal equity and to create an enabling
environment for innovative and competitive service delivery;
(d) Facilitating responsible credit market access to
subnational governments; (e) Designing institutional
arrangements for intergovernmental fiscal relations to
better coordinate policies; and (f) Aligning operational
capacity with the authorizing environment through the
"accountability for results" framework of public management. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Shah, Anwar |
| author_facet |
Shah, Anwar |
| author_sort |
Shah, Anwar |
| title |
Fiscal Decentralization in Developing and Transition Economies: Progress, Problems, and the Promise |
| title_short |
Fiscal Decentralization in Developing and Transition Economies: Progress, Problems, and the Promise |
| title_full |
Fiscal Decentralization in Developing and Transition Economies: Progress, Problems, and the Promise |
| title_fullStr |
Fiscal Decentralization in Developing and Transition Economies: Progress, Problems, and the Promise |
| title_full_unstemmed |
Fiscal Decentralization in Developing and Transition Economies: Progress, Problems, and the Promise |
| title_sort |
fiscal decentralization in developing and transition economies: progress, problems, and the promise |
| publisher |
World Bank, Washington, D.C. |
| publishDate |
2013 |
| url |
http://documents.worldbank.org/curated/en/2004/04/4125854/fiscal-decentralization-developing-transition-economies-progress-problems-promise http://hdl.handle.net/10986/14114 |
| _version_ |
1764430229231632384 |
| spelling |
okr-10986-141142021-04-23T14:03:20Z Fiscal Decentralization in Developing and Transition Economies: Progress, Problems, and the Promise Shah, Anwar ACCOUNTABILITY ALLOCATION OF RESOURCES ALLOCATION OF RESPONSIBILITIES ASSIGNMENT OF EXPENDITURES ASSIGNMENT OF TAXES AUTHORITY BENEFIT AREA CENTRAL BANKS CENTRAL GOVERNMENT CENTRAL GOVERNMENTS CENTRAL PLANNING CITIZENS CIVIL SERVICE COLONIALISM COLONIES COMPLIANCE COSTS CONSTITUTION CORRUPTION DECISION MAKING DECONCENTRATION DEFICITS DEMOCRACY DEMONSTRATION EFFECTS DEVOLUTION DISTRIBUTION OF INCOME DIVISION OF POWERS DRINKING WATER ECONOMIES OF SCALE ECONOMIES OF SCOPE ELECTED OFFICIALS EMPIRICAL EVIDENCE ENVIRONMENTAL POLICY EVASION EXPENDITURE EXPENDITURE ASSIGNMENT EXPENDITURE ASSIGNMENTS EXPENDITURE RESPONSIBILITIES FEDERAL GOVERNMENT FEDERALISM FINANCIAL CAPACITIES FINANCIAL CRISES FINANCIAL TRANSACTIONS FISCAL FISCAL CAPACITIES FISCAL DECENTRALIZATION FISCAL DISCIPLINE FISCAL EQUALIZATION FISCAL EQUITY FISCAL FEDERALISM FOREIGN DIRECT INVESTMENT FUEL TAXES GARBAGE COLLECTION GENERAL ELECTIONS GOOD GOVERNANCE GOVERNMENT EXPENDITURES GOVERNMENT FINANCE GOVERNMENT RESPONSIBILITY GOVERNMENT REVENUE GOVERNMENT ROLE GRANT DESIGN HEALTH EXPENDITURES HEALTH SPENDING HOUSING INSTITUTIONAL MECHANISMS LAND TAXES LEGAL FRAMEWORK LEGISLATION LEGISLATIVE BODIES LEVELS OF GOVERNMENT LOCAL AUTONOMY LOCAL GOVERNMENT LOCAL GOVERNMENT FUNCTIONS LOCAL GOVERNMENT INSTITUTIONS LOCAL GOVERNMENTS MANDATES MARGINAL COSTS MIGRATION MOTIVATIONS NATIONAL EXPENDITURES NATIONAL GOVERNMENTS NATIONAL LEVEL NATIONAL OBJECTIVES NATIONALIZATION NATIONS POLITICAL REFORMS PRIVATE SECTOR PRIVATE SECTOR PARTICIPATION PROVINCIAL GOVERNMENTS PROVISIONS PUBLIC EXPENDITURES PUBLIC GOODS PUBLIC GOVERNANCE PUBLIC HEALTH PUBLIC MANAGEMENT PUBLIC PARTICIPATION PUBLIC SECTOR PUBLIC SECTOR EXPENDITURES PUBLIC SECTOR PERFORMANCE PUBLIC SECTOR REFORM PUBLIC SERVICE PUBLIC SERVICE DELIVERY PUBLIC SERVICES REGULATORY OVERSIGHT REPRESENTATIVE GOVERNMENT REVOLUTION RISK MANAGEMENT SALES TAXES SOCIAL POLICY SOCIAL SAFETY SOCIAL SAFETY NETS SOCIAL SERVICES STATE ENTERPRISES SUBSIDIARITY PRINCIPLE TAX TAX SYSTEM TAXATION TECHNICAL ASSISTANCE TELECOMMUNICATIONS TOTAL EXPENDITURES TRANSITION ECONOMIES UNFUNDED MANDATES URBAN TRANSPORTATION VOTING TRANSITION ECONOMIES LOCAL GOVERNMENT SIZE GOVERNANCE DECENTRALIZATION SERVICE DELIVERY FISCAL ADMINISTRATION TAXES JUDICIAL ACCOUNTABILITY DEMOCRATIC LOCAL GOVERNANCE The author discusses the revolution in public sector thinking that is transforming the public sectors of developing and transition countries. Countries are reconsidering their fiscal systems and searching for the right balance between central government control and decentralized governance. Political decentralization has advanced in most countries. Subnational expenditures in developing countries as a percentage of total public expenditures have also increased over the past two decades. However, the process is far from complete. In many countries, the central government is still involved in the delivery of local services, local governments have few sources of own-revenues, local governments have limited access to borrowing for capital projects, and the design of intergovernmental transfers does neither address regional fiscal equity nor convey appropriate incentives for fiscal discipline, improved service delivery performance, and accountability to citizens. Decentralized public governance can help realign public sector incentives through greater accountability to citizens, and attenuate the "democracy deficit" caused by globalization and the role of supranational institutions and regimes. However, this requires careful examination of the entire fiscal system. Elements of a comprehensive package of fiscal system reforms would include: (a) Clarifying roles of various levels of government in public service delivery; (b) Reassigning taxing responsibilities to ensure local revenue autonomy, accountability, and efficiency without endangering an internal common market; (c) Designing fiscal transfers to ensure regional fiscal equity and to create an enabling environment for innovative and competitive service delivery; (d) Facilitating responsible credit market access to subnational governments; (e) Designing institutional arrangements for intergovernmental fiscal relations to better coordinate policies; and (f) Aligning operational capacity with the authorizing environment through the "accountability for results" framework of public management. 2013-06-21T16:37:40Z 2013-06-21T16:37:40Z 2004-04 http://documents.worldbank.org/curated/en/2004/04/4125854/fiscal-decentralization-developing-transition-economies-progress-problems-promise http://hdl.handle.net/10986/14114 English en_US Policy Research Working Paper;No.3282 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, D.C. Publications & Research :: Policy Research Working Paper Publications & Research Africa Europe Latin America |