Fiscal Federalism and Government Size in Transition Economies: The Case of Moldova

Publication Date:

December 1, 1999

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: 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

Summary:

This paper examines the relationship between fiscal decentralization—the assignment of revenue sources and expenditure functions across government levels—and government size in Moldova. The empirical results—based on data for a cross-section of Moldovan subnational governments in 1998—suggest that fiscal decentralization is associated with larger subnational governments and that the country’s revenue-sharing system imposes a constraint on subnational spending. Moldova is currently undergoing unprecedented reform of its system of intergovernmental fiscal relations, and consolidation of its local government. This reform package is crucial to ensure that decentralization does not increase the size of government.

Series:

Working Paper No. 1999/176

Subject:

Expenditure Fiscal federalism Fiscal policy Revenue administration Revenue sharing Taxes Total expenditures

English

Publication Date:

December 1, 1999

ISBN/ISSN:

9781451858792/1018-5941

Stock No:

WPIEA1761999

Pages:

28

Please address any questions about this title to publications@imf.org