Subnational Fiscal Disparities and Intergovermental Transfers in LAC

Andrés Muñoz, Gustavo Axel Radics () and Claudia Bone ()
Additional contact information
Gustavo Axel Radics: Inter-American Development Bank
Claudia Bone: Inter-American Development Bank

Hacienda Pública Española / Review of Public Economics, 2016, vol. 219, issue 4, 35-66

Abstract: We document the presence of fiscal disparities among subnational governments (SNG) in Latin America and show the limitations of existing intergovernmental transfer systems to reduce them. For 11 countries in the region during 2000-12, we find that, although transfers reduce disparities in own revenues, the remaining fiscal disparities among SNG are still considerable. We also show that fiscal transfers are distributed without consideration of fiscal capacity and explicit measures of expenditure needs, hampering their equalization potential. Our findings suggest that the introduction of equalization transfers can contribute to tackle more effectively the subnational fiscal disparities and hence improve regional equity.

Keywords: decentralization; fiscal disparities; inequity; transfers; equalization (search for similar items in EconPapers)
JEL-codes: H25 H71 H73 H77 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://www.ief.es/comun/Descarga.cshtml?ruta=~/do ... tas/hpe/219_Art2.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hpe:journl:y:2016:v:219:i:4:p:35-66

Access Statistics for this article

More articles in Hacienda Pública Española / Review of Public Economics from IEF Contact information at EDIRC.
Bibliographic data for series maintained by Miguel Gómez de Antonio ().