commission on fiscal imbalance 合集

Functional cooperation and reducing inter local

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Unformatted text preview: pass the cost and benefits of a function or that are willing to compensate other jurisdictions for the service costs imposed or for benefits received by them ; [economic externalities] (b) that have adequate fiscal capacity to finance their public service responsibilities and that are willing to implement measures that insure inter-personal inter-jurisdictional fiscal equity in the performance of a function. [fiscal equalization] 3. Political Accountability: Functions should be assigned to jurisdictions(a) (a) that are controllable by, accessible to, and accountable to their residents in the performance of their public service responsibilities; [access and control] (b) that maximize the conditions and opportunities for active and productive citizen participation in the performance of a function. [citizen participation] 4. Administrative Effectiveness: Functions should be assigned to jurisdictions (a) that are responsible for a wide variety of functions and that can balance competing functional interests; [general-purpose character] (b) that encompass a geographic area adequate for effective performance of a function; [geographic adequacy]; (c) that explicitly determine the goals of and means of discharging public service responsibilities and that periodically reassess program goals in light of performance standards; [management capability] (d) that are willing to pursue intergovernmental policies for promoting inter-local functional cooperation and reducing inter-local functional conflict; [intergovernmental flexibility] and (e) that have adequate legal authority to perform a function and rely on it in administering the function. [legal adequacy] Application of these assignment criteria is not an easy task. These principles might yield conflicting recommendations for expenditure assignment therefore each must be weighted against others in assigning functional responsibilities. For example, political accountability suggests that subnational governments should administer local services, such as education, which require continuous political control. However, if education services are assigned to subnational governments, wealthier jurisdictions will have more financial resources than poor jurisdictions to allocate for this function. Therefore, assigning this function to subnational governments will contradict to fiscal equalization criteria. On the other hand, assigning it to the central government means loss of political control for local residents. Table 4 provides an overview of expenditures patterns across countries reported in the Government Finance Statistics Yearbook 1998. As seen in the table, functions with high degree of spillover externalities (such as defense and welfare) are exclusively performed by central governments and functions which require high degree of political accountability (such as education) are performed by subnational governments in both federal and unitary countries. 18 162 ACIR (1974), p. 7. Commission on Fiscal Imbalance FIGURE 9 F ig u re -9 : E x p e n d itu re A s s ig n m e n t P ro c e s s F O U R A S S I G N M E N T C r ite r ia E c o n o m ic E f f ic ie n c y ...
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This note was uploaded on 03/06/2013 for the course ECON 220 taught by Professor Paulo during the Spring '13 term at University of Liverpool.

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