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Central government control and fiscal adjustment : Norwegian evidence

Listed author(s):
  • Arnt Ove Hopland


    (Department of Economics, Norwegian University of Science and Technology)

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    Norwegian local governments that violate the balanced budget rule (BBR) are placed in a register. The consequence of being in the register is that the budget and resolutions to raise new loans must be approved by the county governor, the central government's representative in the county. Local governments in the register are subject to stronger central government control and must tighten their budgetary policy in order to be removed from the register. The findings suggest that local governments in the register improve their operating surplus, mainly due to cost reductions.

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    Paper provided by Department of Economics, Norwegian University of Science and Technology in its series Working Paper Series with number 13812.

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    Length: 29 pages
    Date of creation: 31 Oct 2012
    Handle: RePEc:nst:samfok:13812
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