Fiscal reform and federal relations: Brasilian deadlocks

Basilia Maria Baptista Aguirre () and Guilherme Leite da Silva Dias ()

Brazilian Journal of Political Economy, 2009, vol. 29, issue 1, 43-61

Abstract: Brazilian fiscal reform got to deadlocks because proposals tried to avoid considering federal relations. There are two main types of federal relations: the competitive and the cooperative. In both types is possible to observe coordination mechanisms. Brazilian federalism is a mixture of both types what leads to difficulties finding solutions. We argue that is more important to find mechanisms to facilitate cooperation than to discuss the qualities of any alternative fiscal structure. Fiscal reforms brings along a great deal of uncertainty. So it is important to discuss the reform timing and the compensation mechanisms before hand. JEL Classification: H70.

Keywords: federalism; fiscal reform; transaction costs (search for similar items in EconPapers)
Date: 2009
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