## The Challenge of Fiscal Decentralization in Transition Countries

_IMF Working Papers, June 1, 2002_

## Source details

**Canonical URL:** [The Challenge of Fiscal Decentralization in Transition Countries](https://www.imf.org/en/publications/wp/issues/2016/12/30/the-challenge-of-fiscal-decentralization-in-transition-countries-15843)

## Other formats

- [Markdown version](/en/publications/wp/issues/2016/12/30/the-challenge-of-fiscal-decentralization-in-transition-countries-15843/index.md)
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## Bibliographic details
- Authors: Era Dabla-Norris, Paul R Wade
- Published: June 1, 2002
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451852707.001

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### Publication metadata
- Authors: Era Dabla-Norris, Paul R Wade
- Publication date: June 1, 2002
- Series: Working Paper No. 2002/103
- Issue: 103
- Volume: 2002
- Pages: 44
- DOI: https://doi.org/10.5089/9781451852707.001
- Stock No: WPIEA1032002
- ISBN: 9781451852707
- ISSN: 1018-5941
- Note: "This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate"

### Core purpose and scope
- Examines key aspects of the ongoing decentralization process in transition economies.
- Identifies areas where present systems can have potentially adverse impacts on both service delivery and macroeconomic performance.
- Discusses three critical principles of a sound and efficient decentralized fiscal system and contrasts these principles with actual trends and policies in transition countries.

### Major themes and subject coverage
- Budget planning and preparation
- Expenditure and expenditure assignments
- Fiscal federalism and Fiscal decentralization
- Fiscal policy and Public financial management (PFM)
- Revenue administration and tax sharing
- Focus regions and contexts: Baltics, Central Asia, Eastern Europe, transition countries more broadly
- Institutional actors referenced: central government, national government, local government, Tax authorities, IMF country economist

### Key substantive findings (as presented in the overview)
- Decentralization in transition economies involves trade-offs affecting service delivery and macroeconomic performance.
- Existing decentralization systems in transition countries contain elements that can produce potentially adverse impacts on service delivery.
- Existing decentralization systems in transition countries contain elements that can produce potentially adverse impacts on macroeconomic performance.
- There exist three critical principles for a sound and efficient decentralized fiscal system (principles are discussed in the paper and contrasted with observed trends and policies).

### Analytical focus (areas emphasized for analysis)
- Contrasts between the three critical principles of decentralized fiscal systems and actual trends and policies in transition countries.
- How current arrangements for expenditure assignments, equalization grants, and tax revenue sharing affect local and central government finances.
- Implications for general government expenditure and government finance statistics.

### Keywords and thematic tags (as provided)
- annual budget, Baltics, Budget planning and preparation, Central Asia, central government, Eastern Europe, equalization grant, Expenditure assignments, Fiscal decentralization, Fiscal federalism, fiscal reform, General government expenditure, government finance statistics, government finances, govt financing, IMF country economist, local government, national government, Tax authorities, tax revenue, tax sharing, transition, transition country, WP

*IMF Working Paper — "The Challenge of Fiscal Decentralization in Transition Countries", Era Dabla-Norris and Paul R Wade, June 1, 2002.*

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## Content in this bundle

- **The Challenge of Fiscal Decentralization in Transition Countries - WP/02/103**
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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/30/the-challenge-of-fiscal-decentralization-in-transition-countries-15843_