What is in it for the poor? Evidence from fiscal decentralization in Vietnam
AbstractLike other developing countries, Vietnam has attempted to push for greater fiscal decentralization in the hope of a more efficient delivery of social services to targeted citizens. The fiscal decentralization initiative is encouraging and merits pursuit, but the present study however, shows that a misstep in the decentralization process can discriminate disproportionately against the poor. Specifically, an increase in the sub-provincial share of the total provincial expenditures is predicted to bring about an appreciable decrease in the lowest-quintile average monthly income. We suggest that the Vietnamese government require provinces to adopt pro-poor allocation norms rather than reclaiming its control over the provincial expenditure assignment. This paper’s empirical findings sound a note of considerable caution that other developing countries should exercise in their fiscal decentralization efforts to avoid creating unintended consequences for the poor.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 9344.
Date of creation: Jan 2008
Date of revision:
Fiscal decentralization; Vietnam; poverty reduction;
Find related papers by JEL classification:
- H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods
- H83 - Public Economics - - Miscellaneous Issues - - - Public Administration
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-07-05 (All new papers)
- NEP-PBE-2008-07-05 (Public Economics)
- NEP-TRA-2008-07-05 (Transition Economics)
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