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Improving subnational governments’ resilience in the wake of the COVID-19 pandemic

Author

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  • Luiz de Mello
  • Teresa Ter-Minassian

Abstract

The COVID-19 pandemic has had devastating effects on lives, the economy, and the public finances worldwide, drawing attention to the need to enhance resilience to future shocks. This paper focuses on subnational governments, given their important and growing role in the provision of essential public goods and services worldwide. The paper discusses key aspects of subnational resilience, in particular the sensitivity of subnational finances to macroeconomic cycles and shocks and the availability of fiscal buffers; the main factors influencing subnational governments’ ability to provide essential services during crises; and their ability to anticipate and prepare for future shocks, especially those related to climate change. The paper also discusses policy and institutional reform options for both national and the subnational governments to strengthen subnational resilience.

Suggested Citation

  • Luiz de Mello & Teresa Ter-Minassian, 2022. "Improving subnational governments’ resilience in the wake of the COVID-19 pandemic," OECD Working Papers on Fiscal Federalism 37, OECD Publishing.
    • Handle: RePEc:oec:ctpaab:37-en
    DOI: 10.1787/6b1304c8-en
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    More about this item

    Keywords

    economic resilience; fiscal federalism; intergovernmental relations; the future of public finance;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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