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Intergovernmental equalization grants: some fundamental principles

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  • Breton, Albert

    ()

  • Fraschini, Angela

    ()

Abstract

Propositions related to intergovernmental equalization grants are always implicitly or explicitly derived from one model of government or another. The paper assumes that governments are competitive organisms. In such a frame of reference, equalization payments serve to insure that all the units in a decentralized governmental system have a chance to share in the benefits of competition. In other words, equalization payments are stabilization instruments. As such they will generally have an effect on the interpersonal distribution of income, but they are not motivated by that effect. The paper also argues that economic globalization increases the need for equalization grants.

Suggested Citation

  • Breton, Albert & Fraschini, Angela, 2004. "Intergovernmental equalization grants: some fundamental principles," POLIS Working Papers 39, Institute of Public Policy and Public Choice - POLIS.
  • Handle: RePEc:uca:ucapdv:39
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    File URL: http://polis.unipmn.it/pubbl/RePEc/uca/ucapdv/fraschini42.pdf
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    References listed on IDEAS

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    Cited by:

    1. Chakraborty, Lekha S., 2006. "Fiscal decentralisation and local level gender responsive budgeting in Philippines: An empirical analysis," Working Papers 06/41, National Institute of Public Finance and Policy.
    2. repec:sgh:gosnar:y:2008:i:5-6:p:71-89 is not listed on IDEAS

    More about this item

    JEL classification:

    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General

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