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Systems of general grants for local governments in selected EU countries against the background of the general theory of fiscal policy

Author

Listed:
  • Alicja Sekula

    (Gdansk University of Technology)

  • Joanna Smiechowicz

    (; Maria Curie-Sklodowska University)

Abstract

Fiscal policy, including its expenditure aspect, is often discussed and analysed from a variety of angles in the literature on public finances, undoubtedly due to the major importance of this topic. However, not all areas of the expenditure part of fiscal policy have been subjected to in-depth analysis. One of the less discussed tools of fiscal policy consists of general purpose transfers, which are a certain type of expenditure passed from the central budget to local governments. This study focuses on presenting the systems for subsidising sub-national governments in selected European countries and evaluating, based on a synthetic measure, the fiscal policies of France, Italy, the Netherlands, Lithuania, Poland and Finland implemented by means of general transfers, with the aim of identifying the best fiscal policy with respect to subsidising and the characteristic features determining its success. The method of unitisation of statistical feature values was employed in this study to enable comparative analysis. As suggested by the results of the analysis, spanning the years 2003–2012, the highest-ranked fiscal policy implemented via general-purpose transfers has been developed in the Netherlands.

Suggested Citation

  • Alicja Sekula & Joanna Smiechowicz, 2015. "Systems of general grants for local governments in selected EU countries against the background of the general theory of fiscal policy," Working Papers 95/2015, Institute of Economic Research, revised Apr 2015.
    • Handle: RePEc:pes:wpaper:2015:no95
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    Cited by:

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    2. Olena Chygryn & Yuriy Petrushenko & Alina Vysochyna & Anna Vorontsova, 2018. "Assessment of Fiscal Decentralization Influence on Social and Economic Development," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 14(4), pages 69-84.

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    Keywords

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    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General

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