{
  "title": "Fiscal Decentralization and Cyclicality in Latin America: Evidence from a New Regional Budget Database",
  "publication": "IMF Working Papers, May 8, 2026",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2026/05/08/fiscal-decentralization-and-cyclicality-in-latin-america-evidence-from-a-new-regional-575967",
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  "summary": "Using a newly constructed database of highly granular regional-level budgets, this paper documents the growing relevance of regional governments in Latin America over the past three decades and evaluates the implications for fiscal cyclicality.",
  "sections": [
    {
      "heading": "Main findings",
      "content": "- Regional governments in Latin America have grown in relevance over the past three decades, based on a newly constructed database of highly granular regional-level budgets.\n- Regional governments exhibit lower revenue elasticity to national GDP than central governments, primarily due to the limited cyclicality of transfers.\n- On the expenditure side, overall elasticity of regional governments is comparable to central governments, but fiscal adjustment occurs through capital expenditures.\n- Transfers appear to operate primarily as redistribution mechanisms across regions rather than as instruments to offset differences in tax capacity."
    },
    {
      "heading": "Data and scope",
      "content": "- New regional-level budget database covering regional governments in Latin America with high granularity.\n- Time horizon referenced as \"the past three decades.\""
    },
    {
      "heading": "Themes and subject coverage",
      "content": "- Current spending\n- Economic and financial statistics\n- Expenditure\n- Fiscal federalism\n- Fiscal policy\n- Government finance statistics\n- Revenue administration"
    },
    {
      "heading": "Keywords",
      "content": "- budget\n- Caribbean\n- Central America\n- Current spending\n- Decentralization\n- expenditure elasticity\n- Fiscal federalism\n- GDP series\n- Global\n- Government finance statistics\n- IMF working papers\n- Latin America\n- South America\n- Subnational database\n- Subnational government\n- transfers\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2026/05/08/fiscal-decentralization-and-cyclicality-in-latin-america-evidence-from-a-new-regional-575967"
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    "Authors: Davi Bhering Buarque de Gusmao, Hector Perez-Saiz, Joe Ue, Valeria Visser",
    "Published: May 8, 2026",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798229046909.001",
    "Regional governments in Latin America have grown in relevance over the past three decades, based on a newly constructed database of highly granular regional-level budgets.",
    "Regional governments exhibit lower revenue elasticity to national GDP than central governments, primarily due to the limited cyclicality of transfers.",
    "On the expenditure side, overall elasticity of regional governments is comparable to central governments, but fiscal adjustment occurs through capital expenditures.",
    "Transfers appear to operate primarily as redistribution mechanisms across regions rather than as instruments to offset differences in tax capacity.",
    "New regional-level budget database covering regional governments in Latin America with high granularity.",
    "Time horizon referenced as \"the past three decades.\"",
    "Current spending",
    "Economic and financial statistics",
    "Expenditure",
    "Fiscal federalism",
    "Fiscal policy",
    "Government finance statistics",
    "Revenue administration",
    "budget",
    "Caribbean",
    "Central America",
    "Current spending",
    "Decentralization",
    "expenditure elasticity",
    "Fiscal federalism",
    "GDP series",
    "Global",
    "Government finance statistics",
    "IMF working papers",
    "Latin America",
    "South America",
    "Subnational database",
    "Subnational government",
    "transfers",
    "**Working Paper**"
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