Fiscal decentralization and fiscal equalization within regions: the case of Russia
Journal of Public Budgeting, Accounting & Financial Management
ISSN: 1096-3367
Article publication date: 1 March 2006
Abstract
The impact of fiscal decentralization on equalization between regions has received significant attention but there has been much less research of the impact of decentralization on equalization within regions. Theory suggests that the tradeoff between local fiscal autonomy and equalization ought to be most pronounced at the sub-region level where rural-urban disparities in the level of development are substantial. This paper is an empirical analysis of the impact of fiscal decentralization on equalization within one Russian region, Leningrad (State). We show that the regional government uses a mixture of fiscal instruments to strike a balance between giving more budgetary autonomy to local governments and eliminating the disparities among them. We also develop a method for studying this tradeoff between decentralization and equalization when only limited data are available. Finally, we argue and demonstrate that without a detailed understanding of the institutional arrangement for intergovernmental fiscal relations, one cannot evaluate the equalization or decentralization implications.
Citation
Bahl, R. and Wallace, S. (2006), "Fiscal decentralization and fiscal equalization within regions: the case of Russia", Journal of Public Budgeting, Accounting & Financial Management, Vol. 18 No. 1, pp. 27-58. https://doi.org/10.1108/JPBAFM-18-01-2006-B002
Publisher
:Emerald Publishing Limited
Copyright © 2006 by PrAcademics Press