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The multi-level fiscal governance of ecological transition

Author

Listed:
  • Sean Dougherty
  • Andoni Montes Nebreda

Abstract

This paper investigates the role of fiscal federalism in driving ecological transition, a key challenge in the United Nations’ Sustainable Development Goals agenda. The ecological transition seeks a sustainable society that prioritises natural resource preservation and reduces environmental impacts. The study investigates the link between fiscal federalism institutions and ecological transition policies, focusing on regional and local governments’ role in implementing environmental goals. Despite subnational governments’ commitment to green objectives, comprehensive plan implementation has been limited due to local governments’ incentive schemes and capacity constraints. The paper examines the potential of fiscal federalism institutions, such as fiscal rules, transfers and capacity-building programs, to support ecological transition policies. The research emphasises engaging regional and local governments in the green agenda and highlights the need for tailored approaches in multi-level fiscal governance to effectively achieve environmental goals. By investigating fiscal federalism’s potential contribution to ecological transition, the paper offers valuable insights for policymakers addressing environmental challenges through a multi-level governance approach.

Suggested Citation

  • Sean Dougherty & Andoni Montes Nebreda, 2023. "The multi-level fiscal governance of ecological transition," OECD Working Papers on Fiscal Federalism 44, OECD Publishing.
  • Handle: RePEc:oec:ctpaab:44-en
    DOI: 10.1787/2051f0f7-en
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    File URL: https://doi.org/10.1787/2051f0f7-en
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    Cited by:

    1. Julio López-Laborda & Andoni Montes-Nebreda & Jorge Onrubia, 2023. "Going green through local fiscal equalisation," Working Papers 2023-07, FEDEA.

    More about this item

    Keywords

    ecological transition; environmental goals; fiscal federal institutions; fiscal federalism; green agendas;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

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