Assessment of Financial Capabilities of Local Governments in EU Countries for the Development of Local Public Services

Abstract

Local financing in advanced countries enables local governments to assess real local priorities as well as limitations. The present paper deals with financial capabilities of local governments for the development of public services, local government expenditure and fiscal expenditure decentralization in the EU28. By use of cluster analysis, local public expenditures are assessed by selected COFOG functions, as % of total local government expenditures in years 2010-2013. The results proved the largest differences in the set of countries in local government expenditures on social protection and the smallest differences in local expenditures on recreation and cultures, housing and community amenities.