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Intergovernmental fiscal relations, 'Argentine Style'

[journal article]

Gordin, Jorge P.

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Abstract This study assesses the explanatory power of two competing views about intergovernmental fiscal transfers; one emphasizing the traditional neoclassical approach to federal-subnational fiscal relations and the other suggesting that transfers are contingent on the political fortunes and current political vulnerability of each level of government. These models are tested using data from Argentina, a federation exhibiting one of the most decentralised fiscal systems in the world and severe imbalances in the territorial distribution of legislative and economic resources. Over-represented provinces ruled by governors who belong to parties different to that controlling the national executive can bring into play their representational advantages to attract shares of federal transfers beyond social welfare criteria. This finding suggests that decision makers in federal countries must pay close heed to the need to synchronize institutional reforms and fiscal adjustment.
Keywords Argentina; fiscal policy; taxes; federalism; national state; revenue; distribution; decentralization; fiscal equalization; South America; developing country
Classification Public Finance; Political System, Constitution, Government
Free Keywords Fiskalpolitik; Economic governance
Document language English
Publication Year 2006
Page/Pages p. 255-277
Journal Journal of Public Policy, 26 (2006) 3
ISSN 1469-7815
Status Published Version; peer reviewed
Licence Deposit Licence - No Redistribution, No Modifications
This publication is with permission of the rights owner freely accessible due to an Alliance licence and a national licence (funded by the DFG, German Research Foundation) respectively.