Regional imbalances and fiscal equalization by Sinha, R. K.

Cover of: Regional imbalances and fiscal equalization | Sinha, R. K.

Published by South Asian Publishers in New Delhi .

Written in English

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  • India,
  • India.


  • Regional economic disparities.,
  • Fiscal policy.,
  • Fiscal policy -- India.,
  • India -- Economic conditions -- Regional disparities.

Edition Notes

Book details

StatementR.K. Sinha.
LC ClassificationsHC59 .S542 1984
The Physical Object
Paginationix, 213 p. ;
Number of Pages213
ID Numbers
Open LibraryOL3009055M
LC Control Number84902670

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Additional Physical Format: Online version: Sinha, R.K. (Raj Kishore), Regional imbalances and fiscal equalization. New Delhi: South Asian Publishers, © Prominent among the objectives commonly attributed to intergovernmental fiscal transfers is ‘equalization’ of fiscal capacities or resolution of Horizontal Fiscal Imbalances.

[2] Thus, the transfer system can promote efficiency in the public sector and can level the field for intergovernmental competition. [3]. Equalization payments are cash payments made in some federal systems of government from the federal government to subnational governments with the objective of offsetting differences in available revenue or in the cost of providing services.

Many federations use fiscal equalisation to reduce the inequalities in the fiscal capacities of sub-national governments arising from the differences in. Fiscal Imbalance: A situation where all of the future debt obligations of a government are different from the future income streams.

Both of the obligations Author: Will Kenton. Keywords: Fiscal decentralization, horizontal fiscal imbalance, regional growth, Gini coefficient, fiscal equalization Introduction New system of financing of the municipalities and higher territorial units Regional imbalances and fiscal equalization book government) in Slovakia, has taken effect in following the further devolution of responsibilities from central to regional.

The overriding objective of fiscal equalization is to correct imbalances in fiscal capacity of territorial units resulting from sub-central autonomy and differentiation in terms of tax bases and. Fiscal Decentralization Fiscal Imbalance Causes of Vertical and Horizontal Fiscal Imbalances Intergovernmental Fiscal Transfers Conceptual Framework.

Chapter Three Fiscal Decentralization in Ethiopia Legal Framework for Fiscal Decentralization in Ethiopia Expenditure and Revenue Assignments under the FDRE Constitution The federal equalization program is the main policy tool for addressing horizontal fiscal imbalances among the provinces.

W ith respect to these imbalances, the existing level of equalization Author: Bev Dahlby. suggests that for transfer’s redistribution, regional distributive rules could be more appropriate to provide equalization than the national rules.

Keywords: Fiscal Equalization, intergovernmental transfers, regional imbalances JEL Codes: R10, R50, H72, HFile Size: KB. fiscal imbalances that exist among the different levels of government.

There are basically two types of imbalances: vertical and horizontal imbalances. A vertical imbalance occurs when the expenditure responsibilities of sub-national governments do not match with their revenue raising Size: KB.

ADVERTISEMENTS: Fiscal Imbalances: Notes on Different Types of of Fiscal Imbalances. Fiscal imbalance is a mismatch in the revenue powers and expenditure responsibilities of a government. When the revenue powers are divided between two or more tiers of government in a federation, in general, the Central government is entrusted with more financial resources.

Downloadable. In the literature on fiscal federalism, vertical fiscal imbalances have been widely studied, while the theme of horizontal fiscal imbalances and inequality between local governments’ fiscal capacities is still less explored.

This paper contributes to fill the gap. A new method to compute fiscal capacities based on regression analysis is proposed, which can overcome some of. The equalization payments that would be required to bring that province’s fiscal capacity up to the national average are then calculated.

Like capital gains tax, which is set at one-half the rate of income tax, the 50 percent level is intended to be low enough so that equalization payments will not be a disincentive for a province to develop.

Inter-regional redistribution through tax-base equalization transfers is examined in a setting in which taxpayers, organized as lobby groups, influence policy making.

With lobbying only at the local level on tax rates, social welfare maximization implies, ceteris paribus, high (low) equalization rates on the tax bases backed by the strong (weak) lobby by: 2. We are grateful for comments on earlier drafts by A.B.

Atkinson and Robin Boadway. We also wish to acknowledge the conversations and the correspondence we had with David Vardy on the contents of this paper.

In part, our paper complements and extends Vardy's original work in Cited by: Fiscal Federalism and Regional Equity Renuka Viswanathan Abstract Federalism is a political construct, but fiscal federalism seeks to derive principles that can be applied for optimal allocation of functions among different levels of government.

The issue of regional equity can. The notions related to horizontal fiscal relations are related to regional imbalances and horizontal competition. Similarly the notions related to fiscal relations are related to vertical fiscal imbalance between the two senior levels of government, that is the centre and the states/provinces.

Downloadable (with restrictions). By Hansjörg Blöchliger and Claire Charbit Fiscal equalisation is a transfer of fiscal resources across jurisdictions to offset disparities in revenue raising capacity or public service cost.

It covers on average % of GDP or 5% of total government expenditure across OECD countries. Equalisation reduces fiscal disparities by two-thirds on average and in.

Intergovernmental fiscal transfers aim or target is to equalize the financial capacity among the sub national government. 21 Fiscal equalization transfers play an important role in allowing poorer units to compete effectively with strong units and advocated to deal with regional fiscal equity concerns.

22 Fiscal equalization is the means to. AbstractThis paper deals with an important issue in the field of fiscal federalism, the effect of fiscal imbalances on the behaviour of sub-central governments.

We provide a simple theoretical model that considers the effect of both forms of fiscal imbalances on the fiscal effort of local by: 1. ADVERTISEMENTS: Spectacular growth attained by some regions and in some sectors in India, after independence, is in contrast to low levels of development still prevailing in many parts.

The reasons for these regional imbalances are rooted in historical processes and in varied levels of natural resource endowment in various regions of the country. This paper analyzes the effect of a fiscal equalization system on the composition of government expenditures of subnational governments.

We incorporate vertical equalization transfers with optimal choice of the composition of government expenditures in an endogenous growth model and show that such transfers reduce the incentives of recipient Cited by: 8.

In addition to recommending various ways to provide greater fiscal resources and autonomy to the provinces, the report denounced the equalization program for the unpredictability of payment amounts from year to year and for the limitations to fiscal redistribution involved in the five-province norm (Commission sur le déséquilibre fiscal Cited by: Regional asymmetries pose de facto a dilemma for the federal government, which has to act in a symmetrical fashion in political terms.

While a moderate equalization program («solidarité nationale») was acceptable to the parties, this program is insufficient to cope with. Mobility and Fiscal Imbalance of transfers to the provinces to eliminate the vertical fi scal imbalance. As well, the equalization system was reformed, largely by reducing the extent to which provincial natural resource revenues were equalized.

One of the consequences of the latter has. Evaluating the Efficiency and Equity of Federal Fiscal Equalization David Albouy NBER Working Paper No. July JEL No. H73,H77,J61,R13 ABSTRACT In theory, federal transfers that make household location decisions efficient should ignore local cost.

Journal of Public Economics 3 () p North-Holland Publishing Company PUBLIC GOODS, EFFICIENCY, AND REGIONAL FISCAL EQUALIZATION Frank FLATTERS, Vernon HENDERSON and Peter MIESZKOWSKI* Queen's University, Kingston, Ont., Canada Received Februaryrevised version received November by: research to assess intergovernmental fiscal transfers.

It included three country studies on India, Pakistan and the Philippines and a more general study on broad international experiences. The research has examined pertinent theories, international experiences, and evolution of fiscal equalization arrangementsCited by: 2. Fiscal equalization and tax sharing Fiscal equalization can be considered as natural component accompanying fiscal decentralization, since it aims to correct imbalances resulting from the autonomy of sub-national governments.

Decentralization leads to growth of imbalance, when large-scale. result in fiscal imbalances. Federal-regional transfers serve to equalize the marginal cost of public funds between regions hit by different shocks.

The optimal transfers minimize the efficiency cost of taxation in the federation as a whole. The analysis shows how the existence of vertical fiscal externalities, leading regional governments to.

External Imbalances and Fiscal Policy Philip R. Lane∗ Trinity College Dublin and CEPR January Abstract We analyse the role of fiscal policy both in the emergence and the unwinding of external imbalances.

Furthermore, we probe whether there is a role for fiscal policy in the prevention of excessive external imbalances. Regional difference in resource endowment among different commu­nities leads to variation in per capita revenue potential among com­munities.

Horizontal fiscal imbalance is corrected and the principle of fiscal equity is achieved through equalization of fiscal residue.

Prof. Fiscal balance as a percentage of GDP is used as an instrument to measure a government’s ability to meet its financing needs and to ensure good management of public finances. The table below shows the fiscal balance as a percentage of Gross Domestic Product (GDP) in.

This fund, which is aimed at resolving both vertical and horizontal imbalances, is the main equalization instrument of the Spanish regional financing system. Both the regional tax resources and central government transfers were subject to a strong revision inwhich was accepted by Cited by: fiscal equalization.

At one end, Great Britain possesses a sophisticated and comprehensive equalization system across local governments (Smith ). On the other, rather unequal and difficult to change systems exist in the cases of Peru and Chile for both Regional and municipal governments (Letelier y NeyraLetelier y Ormeño ).

The third type of grant, equalization grant, is used to fiscal federalism in ethiopia horizontal imbalances between regional governments through the channeling of resources from the relatively wealthier regions to poorer ones; thereby equalizing the capacity of regional governments to provide a national standard level of goods and services.

A Theory of Vertical Fiscal Imbalance Abstract This paper examines how sequential decision-making by two levels of government can result in vertical fiscal imbalances (VFI). Federal-regional transfers serve to equalize the marginal cost of public funds between regions hit by different shocks.

The optimal vertical fiscal gap minimizes. Home > Policy Research Working Papers > Fiscal Federalism In Switzerland: Relevant Issues For Transition Economies In Central And Eastern Europe. Fiscal and Generational Imbalances: New Budget Measures for New Budget Priorities [Gokhale, Jagadeesh, Smetters, Kent] on *FREE* shipping on qualifying offers.

Fiscal and Generational Imbalances: New Budget Measures for New Budget PrioritiesCited by: 6. – National fiscal equalization aims to mitigate cantonal differences regarding financial capacity.

The efficacy analysis showed that the target of a minimum financial resources level per capita of 85% of the Swiss average was considerably exceeded in all cantons during the period from to. Skip to 0 minutes and 13 seconds A fiscal imbalance is the result of a gap between expenditures and income in the public sector.

The public sector is a crucial part of the economy. It includes central government, local governments and social insurance. And in countries which have a federal government structure, like the United States, Germany, or India, the public sector includes the. Hofman, Bert and Susana Cordeiro Guerra () “Ensuring Inter-Regional Equity and Poverty Reduction,” in Jorge Martinez-Vazquez and Bob Searle, eds, Fiscal Equalization: Challenges in the Design of Intergovernmental Transfers (New York: Springer), pp.

31–Author: Roy Bahl, Richard M. Bird. area of scal federalism is a book co-authored with Dr. C. Rangarajan entitled Design of Fiscal Transfers 34 b1. Equalization Transfers in Canada 35 b2. Equalization Transfers in Australia 36 b3. Swiss Fiscal Transfer System 37 Key Elements of .

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