Macro Policy Lessons for a Sound Design of Fiscal Decentralization
Policy Papers, July 27, 2009
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- Macro Policy Lessons for a Sound Design of Fiscal Decentralization
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Bibliographic details
- Published: July 27, 2009
- Series: Policy Papers
Summary
- Publication date: July 27, 2009
- Fiscal decentralization remains high on the policy agenda of many countries and is mainly driven by political pressures, especially in countries with multiple ethnicities and/or wide regional disparities in incomes or resource endowments.
- Decentralization pressures frequently reflect a desire for more participatory government and greater voice of local constituents in the allocation of budgetary resources.
- Fiscal decentralization can have important macroeconomic implications; Fund advice to member countries (in surveillance, program design, or technical assistance) has often focused on the design and implementation of intergovernmental fiscal arrangements.
- This paper distills the main lessons from the Fund’s engagement with member countries in this area, drawing in particular, (but not exclusively) on technical assistance (TA) provided by the Fiscal Affairs Department (FAD) to ten countries which are broadly representative of the range of members that have requested assistance in this area.
Key themes and findings
- Political drivers:
- Decentralization is often driven by political pressures tied to ethnic diversity and regional disparities.
- Demand for participatory government and local voice in budget allocation is a common motivating factor.
- Macroeconomic implications:
- Fiscal decentralization has important macroeconomic consequences that warrant Fund attention in policy advice and program design.
- Experience base:
- The paper synthesizes lessons from Fund engagement and FAD technical assistance to ten representative countries.
Policy focus areas emphasized
- Design and implementation of intergovernmental fiscal arrangements, reflecting the Fund’s role in:
- Surveillance
- Program design
- Technical assistance
Metadata and subjects (as listed on the page)
- Subject: Borrowing, Fiscal management, Fiscal policy, Fiscal reforms, Governance, Government expenditures, Political economy, Transparency
Source: Macro Policy Lessons for a Sound Design of Fiscal Decentralization — https://www.imf.org/en/publications/policy-papers/issues/2016/12/31/macro-policy-lessons-for-a-sound-design-of-fiscal-decentralization-pp4351
Content in this bundle
- Macro Policy Lessons for a Sound Design of Fiscal Decentralization; July 27, 2009