Local Government Finance, Private Resources, and Local Credit Markets in Asia

Roberto de Vera () and Yun-Hwan Kim ()
Additional contact information
Roberto de Vera: University of Asia and the Pacific
Yun-Hwan Kim: Asian Development Bank

No 46, ADB Economics Working Paper Series from Asian Development Bank

Abstract: The ongoing political decentralization in Asia, with central governments devolving to local governments the responsibilities of delivering key development projects and public services, calls for sound local government finance. Local government finance in the region exhibits several problems: deterioration of the fiscal health in many countries, mismatch between the delegated responsibilities and revenue-generating authority, resultant continued heavy reliance on central government transfers, and lack of political will to develop an external financing strategy to tap long-term private resources. In order for local governments to mobilize private savings for long-term infrastructure projects, it is imperative to develop municipal credit markets. Two models of municipal credit markets can be considered: the bank model popular in Western Europe and the bond model widely used in North America. The bond model has theoretically more advantages than the other. However, Asian local governments may start with either model considering the countries' social–cultural–political milieu and keep a proper combination of both models serving different segments of local credit markets.

Keywords: decentralization; local government finance; municipal credit markets; political economy; public services (search for similar items in EconPapers)
JEL-codes: H71 H72 H77 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2003-10-01
References: View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.adb.org/publications/local-government- ... -credit-markets-asia Full text (text/html)

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:ris:adbewp:0046

Access Statistics for this paper

More papers in ADB Economics Working Paper Series from Asian Development Bank 6 ADB Avenue, Mandaluyong City, 1550 Metro Manila, Philippines. Contact information at EDIRC.
Bibliographic data for series maintained by Orlee Velarde ().