Fiscal Decentralization and Macroeconomic Management in Turkey

Çukur, Asuman

doi:10.1007/978-981-15-4226-8_9

Cited by 3 publications

(3 citation statements)

References 51 publications

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“…Therefore, fiscal decentralization reduces medical resources and access to services, resulting in spatial inequality. Cukur (2022) [14] proved that fiscal decentralization leads to a smaller total government and larger central and local governments, which is in line with the prediction of the Leviathan hypothesis in Turkey.…”

Section: Introductionsupporting

confidence: 83%

Impact of Chinese-Style Fiscal Decentralization on Urban–Rural Integration: Based on Factor Allocation

Zhou

Fan

2023

Sustainability

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The urban–rural relationship has been a critical issue in studies on urban and rural geography. Urban–rural integration development (URI), as an integral part of the urban–rural relationship, needs to be understood under an integrated theoretical framework. Based on the conceptual analysis from productivism to post-productivism, this study constructs a multidimensional framework to understand urban–rural integration, restructuring from five layers that integrate population, space, economic, social, and environmental concerns, and the revised dynamic coordination coupling degree (CCD) model is used to measure the level of URI. Many studies have focused on the connection between URI and factor allocation. However, it is yet to be determined how both fiscal decentralization and factor allocation are linked with URI. This study focuses on this unexplored topic, and the impact mechanism among URI, factor allocation, and Chinese-style fiscal decentralization is investigated by adopting spatial econometric models, for achieving the high-quality development of China’s urban–rural relations. Empirical analysis of China’s three major urban agglomerations reveals that there are promising signs in China’s urban–rural integration development, with an orderly and coordinated structure shaping over the period 2003–2017. The rationality of factor allocation depends heavily on the power comparison between the helping hand and the grabbing hand of local governments under Chinese-style fiscal decentralization. Moderate fiscal decentralization, with a perfect market and social security system, leads to the free flow of factors and promotes urban–rural integration. By contrast, excessive fiscal decentralization causes resource misallocation and hinders urban–rural integration development. In light of our empirical evidence, the coordinated development of small- and medium-sized cities and subcities in urban agglomerations is suggested, it is highly necessary to establish a perfect social and employment security system. In addition, a reasonable space planning system for land use needs to be constructed by China’s governments at all levels. Chinese local governments should pay more attention to rural development in their jurisdiction by stimulating their information advantages under Chinese-style fiscal decentralization.

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Section: Introductionsupporting

confidence: 83%

Impact of Chinese-Style Fiscal Decentralization on Urban–Rural Integration: Based on Factor Allocation

Zhou

Fan

2023

Sustainability

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“…In developing countries, decentralization is often pursued as a means to enhance governance by improving governments’ efficiency, responsiveness, and accountability [ 63 ]. However, critics argue that decentralization carries the risk of exacerbating inequality by constraining the fiscal capacity of local governments, thereby impeding the provision of public goods [ 64 , 65 ].…”

Section: Conceptual Frameworkmentioning

confidence: 99%

Balancing fiscal expenditure competition and long-term innovation investment: Exploring trade-offs and policy implications for local governments

Wenjuan,

Zhao

2023

PLoS ONE

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The mobility of economic factors across jurisdictions has led to increased fiscal competition among decentralized subnational governments. This study examines the relationship between fiscal competition and long-term investment in innovation at the local government level. Panel data analysis, encompassing expenditures, taxes, and innovation inputs from 18 municipalities over a 10-year period, is employed using fixed effects regression. The results reveal a negative correlation between fiscal competition and expenditure on innovation, indicating that intensified competition for mobile capital diverts resources away from essential long-term investments crucial for knowledge-driven growth. Even after controlling for economic and institutional factors, a one standard deviation increase in competition corresponds to an average decline of 25% in per capita innovation investment. These findings highlight the unintended trade-off resulting from heightened competition and underscore the need for policy frameworks that promote localized flexibility while curbing uncoordinated competition that undermines innovation capacity. While fiscal decentralization aims to foster competitive governance, this study provides empirical evidence that short-term expenditure incentives often displace long-term innovation objectives without sufficient coordination. The insights contribute significant empirical evidence on the concealed costs of fiscal competition for regional development. Consequently, a re-evaluation of conventional perspectives on decentralization and competition is warranted, emphasizing the importance of developing cooperative policy solutions that strike a delicate balance between decentralized decision autonomy and strategic coordination. Adopting such an approach is essential to fully leverage the advantages of competitive governance while simultaneously nurturing innovation ecosystems.

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“…Fiscal decentralization policies have been used effectively, especially in Latin American countries such as Argentina, Brazil, and Mexico (Burki et al, 1999). In recent years, analyses of nancial localization policies have become increasingly widespread in the literature, especially in various countries, such as the USA (Dincer, 2010;Stone, 2015), Spain (Lago-Peñas et al, 2017), Korea (Cho, 2018;Park, 2022), Poland (Köppl-Turyna et al, 2016), India (Kalirajan & Otsuka, 2012), Vietnam (Dinh-Thanh et al, 2022), Russia (Ivanova et al, 2019), China (Guo et al, 2022) and Turkey (Carikci, 2019;Cukur, 2020;Neyapti, 2005). Also, many empirical studies have been conducted on nancial localization in recent years.…”

Section: Basic Approaches To Fiscal Decentralizationmentioning

confidence: 99%

Deepening Fiscal Decentralization as a Path to Fiscal Responsibility? A Comparison of the Czech Republic and Turkey

Babaoğlu

Sobotková

Sobotka

et al. 2022

Preprint

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The article deals with the issue of fiscal decentralization in relation to compliance with fiscal discipline at the municipal level. The article evaluates the situation of selected Czech and Turkish cities. In the case of Czech cities, so-called statutory cities were selected, which, due to their size and budget, have a certain independence from the central government. In the case of Turkish cities, the largest ones were analyzed, which also have a high degree of autonomy due to their size. The unifying element of both samples is approximately similar financing conditions. In both cases, shared taxes are used, but they are in the hands of the central government, and the municipalities have no possibility to influence them. In the case of municipalities, they can receive subsidies from the central government. From the perspective of fiscal responsibility management, relations with the central government appear to be a stabilizing element. However, at the same time, strengthening revenues associated with local government could also support fiscal discipline. In particular, this possibility would be significant in the case of smaller municipalities when the share of local income in total income is increasing. Another option for discussion is the availability of debt financial instruments. In the case of Turkish cities, fiscal discipline is significantly correlated with external debt. Although Czech municipalities can easily access debt financial instruments, they cannot use foreign financing. JEL Classification: C33, C35, H71, H72, H77

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Fiscal Decentralization and Macroeconomic Management in Turkey

Cited by 3 publications

References 51 publications

Impact of Chinese-Style Fiscal Decentralization on Urban–Rural Integration: Based on Factor Allocation

Impact of Chinese-Style Fiscal Decentralization on Urban–Rural Integration: Based on Factor Allocation

Balancing fiscal expenditure competition and long-term innovation investment: Exploring trade-offs and policy implications for local governments

Deepening Fiscal Decentralization as a Path to Fiscal Responsibility? A Comparison of the Czech Republic and Turkey

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