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Getting the Most Out of Public Sector Decentralisation in Mexico

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  • Isabelle Joumard

Abstract

Enhanced autonomy of sub-national governments has spurred innovative management. Spending assignments across levels of government, however, often overlap and/or are not yet fully understood by most citizens. Sub-national governments’ accountability is further reduced by the heavy reliance on federal transfers, as opposed to own-revenues (taxes and user fees). In addition, the use of federal transfers as collateral for states' borrowing potentially undermines the role of financial markets in disciplining fiscal behaviour. Getting the most out of decentralisation would thus require a national agreement clarifying responsibilities for each level of government. Improving sub-national governments’ incentives in delivering cost-effective public services would further require improving the quality of information on actual spending and outcomes, raising the volume of their own taxes and reforming the grant systems. Decentralisation should also be more consistent with the aim of improving interregional equity in obtaining access to core public services. This Working Paper relates to the 2005 OECD Economic Survey of Mexico (www.oecd.org/eco/surveys/mexico). Optimiser l'impact de la décentralisation au Mexique L’autonomie renforcée des collectivités territoriales pour la gestion des services publics a permis le développement d’innovations intéressantes. Les responsabilités pour un certain nombre de programmes publics du gouvernement fédéral, des états et des communes se recoupent néanmoins fréquemment et/ou ne sont pas pleinement comprises par la plupart des citoyens. Le rôle prépondérant des transferts fédéraux dans le budget des collectivités territoriales, par opposition aux ressources propres issues de redevances ou d’impôts locaux, n’incite pas les collectivités territoriales à se montrer redevables envers les citoyens. L’utilisation des transferts fédéraux comme garantie pour les emprunts des états nuit à la possibilité d’une discipline budgétaire dictée par les marchés financiers. Pour optimiser l’impact de la décentralisation sur l’économie, il faudrait un accord national clarifiant les responsabilités de chacune des administrations publiques dans la gestion des programmes publics. Les incitations des collectivités territoriales à offrir des services publics répondant mieux aux besoins des citoyens devraient être aussi renforcées en améliorant la qualité des informations sur les dépenses effectives et leurs résultats, en donnant aux impôts locaux un rôle accru et en réformant le système des transferts intergouvernementaux. Il est aussi souhaitable que la décentralisation soit conçue en vue d’une plus grande équité entre les régions pour l’accès aux services publics de base. Ce Document de travail se rapporte à l'Etude économique de l'OCDE du Mexique 2005 (www.oecd.org/eco/etudes/mexique).

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File URL: http://dx.doi.org/10.1787/881825436538
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Bibliographic Info

Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 453.

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Date of creation: 17 Oct 2005
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Handle: RePEc:oec:ecoaaa:453-en

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Keywords: Mexico; fiscal discipline; sub-national government; fiscal federalism; fiscal rules; intergovernmental grants; impôts locaux; Mexique; règles budgétaires; discipline budgétaire; fédéralisme financier; collectivités territoriales; transferts intergouvernementaux;

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Cited by:
  1. Cabrera-Castellanos, Luis F. & Lozano-Cortés, René, 2008. "Descentralización y Federalismo Fiscal en México
    [Decentralization and Fiscal Federalism in Mexico]
    ," MPRA Paper 10572, University Library of Munich, Germany.
  2. Luca Gandullia, 2012. "The role of direct taxes in fiscal decentralization," DEP - series of economic working papers, University of Genoa, Research Doctorate in Public Economics 6/2012, University of Genoa, Research Doctorate in Public Economics.
  3. Cinthya Caamal Olvera., 2007. "Oferta Laboral en México: un enfoque de variables instrumentales," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(1), pages 115-154, May.

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