TRANSFERS AND HORIZONTAL FISCAL IMBALANCES IN THE MAIN LARGE MUNICIPALITIES OF MEXICO TRANSFERENCIAS Y DESEQUILIBRIOS FISCALES HORIZONTALES EN LOS PRINCIPALES MUNICIPIOS GRANDES DE MEXICO

Luis Lenin Herrera Diaz de Leon, Roberto Gonzalez Acolt and Cristian Omar Alcantar Lopez

Revista Internacional Administracion & Finanzas, 2023, vol. 16, issue 1, 1-14

Abstract: In 2007, the Mexican government carried out reforms for distributing and transferring resources to subnational governments in pursuit of a series of objectives. The most important objective was to reduce fiscal imbalances. The purpose of this article is to identify correlation between federal transfers and horizontal imbalances in municipal public finances. A longitudinal analysis was carried out with a panel data econometric tool for the 75 largest municipalities in Mexico during the years 2000 to 2016. Results show a positive relationship between horizontal imbalances with transfers. For every 1,000 pesos of transfer per inhabitant, the amount of horizontal fiscal imbalance increases by 1,087.75 pesos. In turn, the political factor influences 90% of the horizontal imbalances but only in the period 2008 to 2016.

Keywords: Fiscal Federalism; Federal Transfers; Fiscal Imbalances (search for similar items in EconPapers)
JEL-codes: H77 (search for similar items in EconPapers)
Date: 2023
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