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Fiscal Federalism in Russia: Rules versus Electoral Politics

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  • Vladimir Popov

    ()
    ([1] New Economic School, Moscow, Russia. [2] EURUS, Carleton University, Ottawa, Canada.)

Abstract

This paper examines the determinants of financial flows between the federal government and regional authorities in Russia. The main question is to what extent intergovernmental transfers correspond to the ‘ideal pattern’ – equalisation of the abilities of the regions to provide public goods – and to what extent, if at all, they reflect the influence of federal–regional political discourse (asymmetrical federalism). The main finding is that actual net transfers since 1994, although quite close to the ‘ideal patterns’, depended also on the results of the parliamentary (1993, 1995, 1999) and presidential (1996, 2000) elections and on the relations of the regions with the federal centre. The more votes cast for pro-central government parties in parliamentary elections and for Yeltsin in the 1996 presidential elections and the lower the tensions with Moscow after the elections, the more favourable was the fiscal balance for the region with the federal centre. The result is very robust when using different measures of fiscal capacity (index of tax potential) and costs of providing public goods (budgetary expenditure adjustment index). Comparative Economic Studies (2004) 46, 515–541. doi:10.1057/palgrave.ces.8100049

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Bibliographic Info

Article provided by Palgrave Macmillan in its journal Comparative Economic Studies.

Volume (Year): 46 (2004)
Issue (Month): 4 (December)
Pages: 515-541

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Handle: RePEc:pal:compes:v:46:y:2004:i:4:p:515-541

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Cited by:
  1. Libman, Alexander, 2009. "Constitutions, Regulations, and Taxes: Contradictions of Different Aspects of Decentralization," MPRA Paper 15854, University Library of Munich, Germany.
  2. David Hauner, 2007. "Benchmarking the Efficiency of Public Expenditure in the Russian Federation," IMF Working Papers 07/246, International Monetary Fund.
  3. Libman, Alexander, 2008. "Federalism and regionalism in transition countries: A survey," MPRA Paper 29196, University Library of Munich, Germany.
  4. Libman, Alexander, 2010. "Words or deeds - what matters? Experience of recentralization in Russian security agencies," Frankfurt School - Working Paper Series 148, Frankfurt School of Finance and Management.
  5. Hauner, David, 2008. "Explaining Differences in Public Sector Efficiency: Evidence from Russia's Regions," World Development, Elsevier, vol. 36(10), pages 1745-1765, October.
  6. Israel Marques & Eugenia Nazrullaeva & Andrei Yakovlev, 2011. "From Competition to Dominance: Political Determinations of Federal Transfers in Russian Federation," HSE Working papers WP BRP 12/EC/2011, National Research University Higher School of Economics.
  7. Jorge Martinez-Vazquez, 2002. "Asymmetric Federalism in Russia: Cure or Poison?," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper0304, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
  8. Lev Freinkman & Konstantin A. Kholodilin & Ulrich Thießen, 2009. "Incentive Effects of Fiscal Equalization: Has Russian Style Improved?," Discussion Papers of DIW Berlin 912, DIW Berlin, German Institute for Economic Research.

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