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Spanish fiscal federalism at the crossroad: A survey

Listed author(s):
  • Xoaquín Fernández Leiceaga
  • Santiago Lago Peñas
  • Alberto Vaquero

In just over three decades Spain became one of the most decentralized countries in the world, at least in the tax area. This paper aims to conduct a detailed analysis of this unplanned process, showing the successful aspects, but also its shortcomings and failures. Furthermore, this analysis will also help to understand current political tensions in Catalonia, and, to a lesser extent, the Basque Country. Our second aim is to review the way in which the Spanish sub-central levels of government have responded to the so-called “great recession”. Spain is a good laboratory for what actually works and what does not in the area of stability and fiscal sustainability in decentralized states, for two reasons. First, it is by far the country which has suffered the brunt of the economic and financial crisis most acutely among those with a federal structure. And second, subsequent different solutions for tackling the fiscal crisis of sub-central governments have been tested.

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File URL: http://infogen.webs.uvigo.es/WP/WP1601.pdf
File Function: First version, 2016
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Paper provided by Universidade de Vigo, GEN - Governance and Economics research Network in its series Working Papers. Collection A: Public economics, governance and decentralization with number 1601.

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Length: 32 pages
Date of creation: Jan 2016
Handle: RePEc:gov:wpaper:1601
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  1. Julio López Laborda & Jorge Martinez-Vazquez & Carlos Monasterio Escudero, 2006. "The Practice of Fiscal Federalism in Spain," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper0623, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
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