This thesis is entitled ’Fiscal policy and economic growth in the presence of intergenerational transfers’. It is composed of four self-contained chapters and focusses on the growth and welfare effects of taxation and public spending. The common denominator of all four chapters is that they incorporate an endogenous growth process in an overlapping generations model to evaluate long-term policy implications when different generations are affected in different ways by fiscal policy. In the first and second chapter the implications of capital income taxation for the growth process are discussed. The analysis emphasizes the role of public and private intergenerational transfers in form of public pensions and bequests as well as intergenerational redistribution induced by public policies. Among other results, it turns out that the presence or absence of such transfers critically determines whether an increase of capital income taxes with additional revenue being devoted to cut wage taxes may enhance economic growth. In the third chapter, the focus of the analysis is on social security funding and its implications for economic growth. Whereas a pay-as-you-go pension scheme, as considered in chapter one, naturally includes intergenerational transfers from the current working generation to retirees, a fully funded social security system does not. Still, the presence of such transfers within the economy in form of private educational spending and bequests turns out to play a key role in deter- mining the impact of funded social security on economic growth. More specif- ically, it is shown that a funded pension scheme may harm growth if there are operative bequests within the family, and parents thus face a trade-off between educating their children and leaving bequests. By contrast, when bequests are inoperative, the Ricardian equivalence holds and an increase in forced savings is exactly offset by a reduction in private savings leaving capital accumulation and educational spending unchanged. Chapter four discusses the impact of fiscal decentralization on economic growth in the context of education funding. While the traditional theoretical literature on fiscal decentralization focusses mainly on efficiency issues, empirical evidence for a positive relationship between fiscal decentralization and economic growth turns out to be mixed. Some studies can confirm the positive impact of higher degrees of decentralization on economic growth, whereas others face difficulties in establishing a positive relationship and, in fact, obtain either no dependency or a negative one. The aim of the fourth chapter is therefore to further evaluate the theoretical linkage and, at the same time, to give an ex- planation for the discrepancy between the empirical literature. The analysis reveals that there exists a growth maximizing degree of fiscal decentralization. Furthermore, it is shown that some degree of fiscal decentralization is always superior (in terms of long-run growth and welfare) to a system where either local or central governments exclusively finance educational investments.
Against the backdrop of the financial and economic crisis, federal and regional States are engaging in several reforms. The financial constitutional design and institutional setting in the area of fiscal and financial matters are being revised in order to better adapt to the current challenges, which result both from the supranational sphere of economic governance and the domestic one. The rationale behind these reforming processes lies in the struggle between the apparent needs to re-centralize while accommodating decentralization claims. The paper focuses on federal and highly regionalized European States by adopting a comparative domestic perspective and investigates reform processes in the area of fiscal matters and financial intergovernmental relations. It explores the most significant features that permeate the various legal orders, trying to single out the different trends in shifting powers in favour of either (re)centralization or decentralization. To this extent the recognition of autonomy on the revenue side and the accommodation of autonomy and solidarity within the new fiscal regimes will be analyzed. Moreover,intergovernmental cooperation in fiscal and financial areas will be scrutinized trying to point out crucial characteristics from a comparative perspective. To this regard particular attention will be given to major recently established bodies and procedures in the fiscal and public finance area as well as to their role within domestic economic governance.
This book is based upon research and reflection supported by BALTA during its initial research program from 2006-2012. It explored many of the themes that became central to BALTA’s work in its Scaling Innovation for Sustainability Project. With our communities confronted by major sustainability challenges, many linked to the impact of climate change, it argues for replacing the paradigm of limitless economic growth with a more decentralized, co-operative, steady-state economy. It examines case studies of success in energy sufficiency, local food systems, low-cost community based financing, affordable housing and land reform. Specific chapters and the book as a whole redefine the development paradigm within a sustainability and steady-state economic framework.
One important aspect of fiscal decentralization policy is delegation of authority and responsibility of management of public finance to regional governments, especially those of municipalities/districts. After more than ten years of implementation, it is now the right time to evaluate the policy questioning how effective its impacts on regional economic development. The study intends to find on how effective the performance of regional public finance is in providing basic infrastructures and how effective the provision of basic infrastructures reduces the poverty rates. By using panel data methods, this study confirms the positive relationship between performance of regional finance management and provision of basic infrastructures (especially those of road and electricity, but not that of drinking water). On the other hand, the relationship between the provision of basic infrastructures and poverty rates, as expected, is negative. This finding strengthens the belief that it is necessary to further enhance the basic infrastructures development to reduce poverty rates.
Fordism-Keynesianism gradually transited to neoliberalism during 1970s economic recession in capitalist society, shifting urban governance from managerialism to entrepreneurialism. At the same time, China’s 1978 political-economic reform has led to a rapid development and a profound urban transformation characterized by globalization, neo-liberal decentralization and marketization over the past thirty years. To sustain the development and further promote the transformation, mega-events as one of those entrepreneurial policy programs are increasingly favored and widely used by city policy makers. Adopting urban entrepreneurialism as the theoretical perspective, this research explores mega-events, aiming to resolve two debates concerning urban entrepreneurialism and mega-events in the context of China: whether mega-events are effective and sustainable ways for China’s urban development in entrepreneurial city discourses and whether Chinese cities and their local states are entrepreneurial in nature in mega-events? It then takes Shanghai Expo 2010 as the case, focusing on how the Expo as entrepreneurial city action impacts on Shanghai’s urban transformation and how different stakeholders behave in the Expo development. Analysis of the case provides some findings resolving the debates. \n \nFirst, through landscape reconfiguration, spatial restructuring and new sources provision, Expo 2010 effectively transforms Shanghai city within a short time, showing entrepreneurial city qualities in diminutive spatial scale. However, it fails to improve social life except those who under high media exposure and is powerless to impress the world as China has little voice in the Western mainstream media. Moreover, while Expo 2010 generally benefits sustainable development by using energy saving technologies in Expo Park, by creating “Shanghai Mode” rehabilitation for affected communities and by preserving industrial and cultural heritage for future creative industry development, it still negatively impacts general urban living and causes exorbitant investment. \n \nThen, entrepreneurial governance is manifested in Expo operation as municipal government unites various stakeholders to ensure the smooth progress of the event, a process explicable by both urban regime and growth machine models. The private sectors are encouraged by municipal government to join Expo market as sponsors or developers and are mobilized interests triggered by Expo opportunities. Civil communities play auxiliary roles that must be united by government to achieve long-term growth. Urban planners are important inter-mediators among stakeholders in Expo, serving municipal government for urban growth. Although “Local Developmental State” model exhibits at municipal level as “development” represents the primary legitimizing principle of the state above those of individuals and the plan-rationality suppresses the market rationality, the “Entrepreneurial State” model can better interpret the nature of government in terms of coordination and partnership in Expo 2010. The government start-ups commercially operate in financing, investment attraction and land development, actively cooperating with private, foreign capitals and other social forces. \n \nThese findings imply that the event-led restructuring is overall effective for the transformation of urban order from traditional industries to flexible leisure consumption, from monocentric city to polycentric mega-city region, consistent with the tide of postmodern city. They also imply that the operation of Expo by municipal government is entrepreneurial in nature, corresponding to the emerging neo-liberalization with Chinese characteristics.
Polish Abstract: Rozwoj edukacji jest jednym z priorytetow polityki Unii Europejskiej od początkow jej istnienia. W ciągu ostatnich 15 lat szczegolny nacisk kladziony jest na modernizacje szkolnictwa wyzszego, ktore postrzegane jest jako kluczowe dla rozwoju zarowno calej Unii Europejskiej, poszczegolnych panstw czlonkowskich, jak i indywidualnych obywateli. Postulowane reformy wymagają zmian w obszarze zarządzania, jak i finansowania uczelni, a w szczegolności odejścia od scentralizowanego finansowania zorientowanego na zasoby w kierunku zdecentralizowanego finansowania zorientowanego na wyniki. Transformacja ta powoduje koniecznośc mierzenia efektywności i skuteczności szkolnictwa wyzszego w roznych jego aspektach, w tym rowniez w obszarze edukacji. Artykul koncentruje sie na badaniu mozliwości zastosowania modelu J. Mincera do mierzenia wplywu wyzszego wyksztalcenia na poziom wynagrodzen i wyznaczania tzw. prywatnej stopy zwrotu z inwestycji w edukacje. Badania empiryczne przeprowadzone są na danych pochodzących z niemieckiego badania panelowego SOEP.English Abstract: The development of educational system has been one of the priorities of European Union policy since the beginning of its existence. In the course of the last 15 years particularly strong emphasis has been placed on modernization of higher education, which is perceived as key factor for development of European Union, each member state separately, as well as individual EU citizens. The postulated reforms require changes both in the area of governance and funding of the universities, in particular a shift form centralized input oriented funding mechanisms towards decentralized outcome oriented financing is needed. This transformation causes necessity for measurement of efficiency and effectiveness of various aspects of higher universities activities, including education area. The paper focuses on application of Mincer model in analysis of higher education influence on the level of wages in order to determine the private rate of return to education. Empirical research have been conducted using the data from German Socio-Economic Panel Study (SOEP).
Eurasian cities, unique in the global \n spatial landscape, were part of the world's largest \n experiment in urban development. The challenges they now \n face because of their history offer valuable lessons to \n urban planners and policy makers across the world from \n places that are still urbanizing to those already urbanized. \n More than three-quarters of the built environment in \n Eurasian cities was developed after 1945 in a centralized \n fashion. Central planners could implement whatever they \n considered good practice planning solutions, and \n Eurasia's cities became their drawing boards. The \n central planners got a lot right easy access to public \n transportation, district heating networks, almost universal \n access to water systems, and socially integrated \n neighborhoods. At the same time, they failed to acknowledge \n the importance of markets and individual choice in shaping \n sustainable and congenial places for people to live in. From \n a spatial point of view, it became clear that many Eurasian \n cities were developed in places where they should not have \n been. To populate sparsely inhabited territory, Soviet \n planners pushed urban development toward the heart of \n Siberia. Many of the resulting cities had no rural \n hinterland to rely on for daily food needs and had to depend \n on subsidized goods and services. Many Eurasian cities face \n an overdeveloped public service infrastructure that is hard \n to maintain and upgrade. Facing an economic downturn in the \n 1990s and lacking experience in decentralized urban \n management, many local authorities struggled to run these \n services. Public transport ridership fell in most cities, \n with more people commuting in private vehicles. Recycling \n networks disappeared, and soaring consumption overwhelmed \n solid waste management systems. District heating systems \n became large energy sieves hard to run and maintain without \n subsidies. Plaguing water systems are large shares of \n nonrevenue water, and low tariffs do not ensure the cost \n recovery needed for upgrades and repairs. This book \n discusses all five of these issues rethinking, planning, \n connecting, greening, and financing in more detail. It seeks \n to analyze the key challenges created by central planning, \n outline how these challenges were addressed in the \n transition years, and identify some steps Eurasian cities \n should take to chart a sustainable development path for \n themselves. The book also shows how some of the most \n progressive cities in the region have been tackling these \n problems and, in doing so, shedding the last vestiges of the \n socialist economy.
Built on the theories about talent competition between rent-seeking and entrepreneurship, and the theories about constitutional environment and rent-seeking, this dissertation explores empirically the effects of a country's constitutional settings on entrepreneurship, in terms of the quantity of entrepreneurs and the quality of their performance. Both the de facto and de jure constitutional environments are studied. In particular, with respect to the de facto constitutional environment, I considered the property rights protection, decentralization, and the factors suggested by the "selectorate theory". In relation to the de jure constitutional environment, I focused on six aspects including electoral rules, form of government, federalism, property rights protection, judicial independence and antidiscrimination provisions. Three indexes were constructed to measure the de jure property rights protection, judicial independence and antidiscrimination provisions, using the data set provided by the Comparative Constitution Project.The empirical study first shows that the quantity of entrepreneurs is inversely correlated with the quality of entrepreneurship in a country. If entrepreneurship does serve as the engine of economic growth, it is perhaps the quality, rather than quantity, that matters. This study then demonstrates that the de facto property rights protection is associated negatively with the quantity of entrepreneurs, but positively with the quality of entrepreneurship. The effects of the two key factors of the selectorate theory, the size of the winning coalition and the ratio of this size to the size of the selectorate, also appear to be compatible with what the theory is to predict. On the other hand, neither fiscal nor political decentralization is found to significantly affect entrepreneurship. Among the de jure constitutional features, two have significant influence on entrepreneurship. First, the constitutional design of judicial independence has a negative effect on the quantity of entrepreneurs, but a positive one on the quality of their performance. Second, majoritarian electoral rules, compared with non-majoritarian rules, have a negative effect on the quality of entrepreneurship. In contrast, the presumed effects of the other three formal constitutional attributes, federalism, presidentialism and property rights protection, cannot be ascertained.Apart from the cross-country study, I also conducted a detailed research on China. Entrepreneurship in China is a case of entrepreneurial development in an authoritarian state lack of secure property rights and the rule of law, hence afflicted with profuse rent-seeking activities. Under these circumstances, entrepreneurship hinges on both the rent-seeking and the entrepreneurial abilities. Drawing on the private enterprise surveys, I found that, in China, the politically connected were systematically advantaged in terms of bank finance, entry to regulated industries and judicial treatment, when they plunged into the business world. The Chinese case also indicates that, when entrepreneurs cannot trust the commitment made by the state in the constitution, they will be eager to scoop profits as soon as possible and exit swiftly with accumulated wealth.Finally, this dissertation concludes by suggesting that a healthy development of entrepreneurship should be sustainable rather than aiming merely at quick money and instant success. It should allow all talented people to reach their full potentials, rather than keep the politically disconnected away from resources needed to make the best use of their potentials. Above all, it wants a constitutional environment with reliable property rights and equal access to opportunities, neither of which is seen in today's China.
Abstrak Otonomi daerah dan desentralisasi fiskal mempunyai tujuan untuk menciptakan suatu kemandirian daerah. Tidak semua daerah mempunyai kesiapan yang sama dalam menciptakan kemandiriannya. Untuk mengatasi permasalahan ini, pemerintah pusat memberikan dana perimbangan/dana transfer kepada pemerintah daerah. Tetapi bukti empiris beberapa penelitian menunjukkan adanya fenomena terjadinya flypaper effect pemerintah daerah di Indonesia, dengan indikasi dominannya peran dana transfer terhadap pendapatan daerah dalam membiayai pengeluaran pemerintah daerah. Penelitian ini menggunakan sampel sebanyak 30 daerah di Jawa Tengah yang bersumber dari Laporan Realisasi Anggaran Pendapatan dan Belanja Daerah (APBD) dari tahun 2009 hingga 2011. Metode pengambilan sampel menggunakan metode purposive sampling . Alat yang digunakan penelitian adalah regresi logistik. Hasil dari penelitian ini Belanja Pegawai mempunyai pengaruh yang signifikan terhadap flypaper effect . Sedangkan Investasi Pemerintah Daerah dan Pembayaran Utang Pemerintah Daerah tidak berpengaruh terhadap flypaper effect . . Abstract Regional autonomy and fiscal decentralization has the objective to create a regional self-reliance. Not all regions have the same readiness in creating independence. To overcome this problem, the central government balance fund / fund transfers to local governments. But the empirical evidence, some studies suggest the existence of the flypaper phenomenon of local government in Indonesia, with an indication of the dominant role of the transfer of funds to finance revenue expenditure in the region. This study uses a sample of 30 regions in Central Java are sourced from the Report of Actual Revenue and Expenditure Budget (budget) from 2009 to 2011. Sampling method using Purposive Sampling method. Research tool used is logistic regression. The results of this study Shopping Employees has a significant effect on flypaper. While the Local Government Investments and Local Government Debt Payments had no effect on flypaper.
The analysis of the administrative capacity of institutions in the regional development starts from the analysis of the existing framework for the implementation of regional politics in Romania and studies the extent to what the structures and competencies were regionally enlarged as to contribute in the regional development. The basic hypothesis considered for such analysis had in view the fact that the differences recorded with respect to the implementation capacity of the regional development policy are caused by the various levels of the administrative capacity of the national, regional and local institutions existent in Romania. Although the regional development activity is, both centrally and regionally, dominated by the Regional Operational Programmme 2007-2013 (ROP) implementation, significant activity also exists outside the ROP, but only regionally. The regional strategies incorporate to a great extent the strategic objectives established nationally, being coordinated with the national financing instruments for economic, social and territorial development. The undertaking degree of responsibilities regarding the objectives fulfillment of the regional development policy is relatively low both regionally and locally, and the main indicator which contributes in sustaining this conclusion is the absence of an adequate level regarding the property holding on certain strategies and also the methodological lack of strategies. Nationally, the current activity of Ministry of Regional Development and Tourism in the field of regional development totally overlaps the management activity of ROP. The management of structural funds 2007-2013 granted through ROP deals with various situations in which, due to the fact that the Law of regional development remained behind the legislation for the structural instruments implementation in Romania, additional resources are necessary to be granted in order to be found solutions through other types of regulations. The Romanian legal and institutional setting allowed a centralized top-down approach for the regional development process and brought forward the approach of the type â€Å"local development which falls among certain priorities of regional development established nationally†. Definitely, the local development is important for the regional development, but it is not self-sufficient in this respect. Therefore, the centralized approach should be completed by a decentralized approach, as a natural next phase.
Independent regulatory bodies are important economic institutes, which take on a part of classical state affairs, which generally need particular, i.e. specialized knowledge, which does not exist in state management. European countries have different experiences when it comes to bearers of public authorization, representing intermediaries between the state on one hand, and companies and citizens on the other. In those countries with a traditionally big state apparatus, there are few agencies and vice versa, where there is a large portion of state affairs decentralized, small governments, supported by a modest central state apparatus are established. In the countries of Central and Eastern Europe, along with the process of transition, there occurred the process of "agencification". Serbia is maybe the worst example, with large coalition governments, which have established almost 200 different independent institutions. The causes of independent public body boom in Serbia are to be sought in a too liberal understanding of laws regulating this area, which has created the possibility of political feudalism. Also it has created an inappropriate autonomy of institutions (inappropriate for Serbian conditions, especially when it comes to finance), with a clear debalance of quality of employees in those bodies and the system of their compensation compared to contribution given by their work. Recent political changes, "new waves" of global economic crisis and large crisis of state financing are making boom problem solving quicker, and also are putting under control the behavior of bearers of public authorization in Serbia. However, it seems that this process still lacks good and impartial methodology and argumented atmosphere for making political decisions.
The Hong Kong government has dedicated considerable resources to study and test the viability of office decentralization within the city since the 1980s, with objectives to achieve more sustainable industry spatial patterns and to relieve the Central Business District (CBD)from pressures created by high density of establishments and employment. Policies encouraging firm relocation from CBD areas to other office nodes have been implemented, and it was believed that the construction of new railway lines would facilitate such decentralization policies. In addition, a review of literature suggests that decentralization seems to be an inevitable trend in the evolution of a city. In particular, it was proposed by Smith & Selwood (1983) that decentralization could be industry-selective. \n \nWith this background, this research aims to examine whether industries in Hong Kong have actually exhibited decentralizing spatial patterns from the period 1995 to 2010and to compare trend of changes in spatial patterns among different industries. Four industries were selected as the target of study, which are (1) finance and insurance, (2) professionals services, (3) real estate, and (4) import/export, wholesale and retail trades. Their employment and establishment data at Tertiary Planning Unit (TPU) level were obtained from the Census and Statistics Department and processed. \n \nThrough the use of spatial tools, it was found that the real estate industry experienced most rapid trends of decentralization, both in establishment and employment. The other industries were less obviously decentralized; for the finance and insurance industry and the import/export, wholesale and retail industry, there even appeared indicators of stronger concentration in the study period. These findings provide strong support for future relocation policies to be industry-oriented. Another important finding is that for all industries in all study years, employment distribution tends to be more centralized than establishment distribution, which suggests that decentralizing people may be harder to achieve than decentralizing offices. It is thus envisaged that in the future, government policies regarding traffic management need to complement decentralization policies in order to alleviate transportation pressure in Hong Kong’s CBD area.
Background: Health financing provided by the government greatly helps the implementation of health system in the decentralized era. General Allocation Fund and Local Revenue and Expenditure Budget are apparently inadequate to finance health service. Some efforts have been made to finance health service such as Community Health Insurance (Jamkesmas), Childbirth Insurance (Jampersal), and Health Operational Fund (Bantuan Operasional Kesehatan/BOK). These are meant to achieve Millennium Development Goals in 2015. The practice of coordination from planning to implementation and stakeholders’ commitment can affect the process of maternal and child health service. Coordination is definitely needed to run the program policy and prevent the overlapping financing in order that the objective of the program can be achieved. Objective: To evaluate coordination of planning, implementation and stakeholders’ commitment in relation to maternal and child health (MCH) service in Lombok Tengah District. Method: This was a descriptive-analytical study with a qualitative approach and a case-study design. Samples were taken purposively. The data were obtained through in-depth interview, observation and documentation analysis. Result: The planning coordination of MCH health financing had not been optimal, even despite the involvement of cross sector and program. However, the organizations of health professionals were not involved in program planning. The coordination of health financing implementation had not been optimal as well. Even though there was no overlapping financing from some different sources, in the policy implementation there was cost sharing for referral and drugs. Private sectors were not involved in the implementation of Jampersal. Stakeholders’ commitment was relatively optimum as reflected from the policy and action in health development acceleration particularly MCH. The process of MCH service at both primary and secondary level could run well. Conclusion: Coordination of MCH financing implementation in Lombok Tengah District through BOK, Jampersal, Jamkesmas, Community Empowerment National Program of Healthy and Smart Generation and Local Revenue and Expenditure Budget had not been optimal; therefore, it needed to be improved to eliminate cost sharing. Professional organizations and private health providers were not yet involved in the program planning and implementation. Keywords: coordination, stakeholders’ commitment, health financing, maternal and child health, program evaluation
Jesús Ruiz-Huerta Carbonell, Miguel Ángel García Díaz
In Spain, as a consequence of the persistence of the economic crisis, the deficit and debt of the public administrations have become a main issue on the current economic and political debates In the case of a highly decentralized scenario, such it is the Spanish one, even if we recognize the principal role of Central Government´s debt, a large part of the increased Autonomous Communities’ deficit and indebtedness is explained by the difficulties they have to face in financing services they have to cover. The paper describes the main characteristics of public accounts’ disequilibria in Spain and the regulatory limits established to make use of public debt. Also, the article offers different explanations of those disequilibria, putting the emphasis on those linked to the crisis: i.e. the increasing weight of basic welfare services covered by the Autonomous Communities (such as public health and as education); as the expansive policies implemented to fight the initial effects of the crisis; as the existence of previous and large “extraordinary” resources coming from the housing sector and its consequent collapse; as growth of the debt of the autonomous-community quangos and as the lack of effective accountability mechanisms addressed to control the expenditures of the autonomous communities.
Both national equity in healthcare and the county councils’ local autonomy are important values supported by Swedish law. Politically it is a balancing act; how much freedom should the county councils have and to what extent should healthcare be equal throughout the country? The general aim of this dissertation, concerning political governance in Swedish healthcare, is to investigate the tensional values of national equity and local autonomy in the light of current trends in healthcare governance in Sweden. How is this tension manifested? Four studies are included in the dissertation. These studies show that the Swedish state is becoming more active in governing and regulating healthcare, for example by the use of informative governance and legislation, which increasingly rely on monitoring and evaluation of results that are made public. The findings show that the tension between national equity and local autonomy is manifested in increasing emphasis on national equity – or rather national equivalence – which is interpreted in terms of Swedish healthcare being recentralized. Delivery and financing of healthcare are still the responsibilities of the county councils. Planning and arranging – the setting of the regulatory framework – is increasingly taken over by the central state. Although power seems to be transferred from local level to central level, the county councils’ autonomy is only partially restricted, which means Swedish healthcare is still decentralized. However, if the recentralization process proceeds further, the county councils´ autonomy may be seriously challenged. Another challenge is to maintain or strengthen the procedures for democratic legitimacy through citizen participation at the local level. When local autonomy looses ground, it becomes more difficult to tailor healthcare according to local needs and conditions in the county councils, and decisions are taken at greater distance from the citizens.
Open access
Health Systems, Economic Evaluations, Quality of Life