State and local fiscal structures and fiscal stress

Bibliographic Data

ID20201241
AuthorsHannarong Shamsub (0000-0002-0975-9385), Joseph B Akoto
Year2004
Volume16
Issue1
Pages40-61
Publication date2004-03-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueJournal of Public Budgeting Accounting & Financial Management (JOURNAL)
Journal identifiersISSN: 1096-3367 • E-ISSN: 1945-1814
PublisherEmerald (PUBLISHER)
DOI10.1108/jpbafm-16-01-2004-b003
OpenAlexW2275501684
LanguageEN
Citations received3
References cited14

In the past two decades, much of the literature in the area of government financial management has been devoted to studying the causes of fiscal stress. Most studies emphasized the role of such factors as economic cycles, business relocation and factors beyond the control of policy makers as major causes of fiscal stress. This study extends the scope of the research in this area to investigate whether state and local fiscal structures contribute to fiscal stress. Using a pooled cross-sectional time-series approach with the state-local data ranging from 1982 to 1997, the result shows that: there is more significant difference in the composition of tax structures than that of total revenue; high aggregate spending is associated with high fiscal stress; state and local governments over-commit on the social welfare category; local revenue diversification is associated with low fiscal stress; and fiscal decentralization or high spending responsibility assumed by local governments is associated with low fiscal stress. The findings suggest that local revenue diversification and fiscal decentralization can be used as measures to reduce fiscal stress

Business · Decentralization · Economic policy · Economics · Fiscal imbalance · Fiscal policy · Fiscal union · Local government · Market economy · Monetary economics · Political science · Revenue · Fiscal Policies and Political Economy · Fiscal Policy and Economic Growth · Local Government Finance and Decentralization · Finance

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