Making Fiscal Decentralization Work: Cross-Country Experiences

Lessons for Effective Fiscal Decentralization in Sub-Saharan Africa

“…Also, the type of decentralization varies from giving more powers to large units (for example, states in federal countries) or much smaller ones (for example, local governments in unitary states). At the end of the day, the impact of fiscal decentralization depends largely on the design of intergovernmental fiscal relations rather than the ultimate extent of decentralization (Fedelino andTer-Minassian 2009, andFedelino 2010). Experience suggests that gradual decentralization is better than a big-bang approach, but it is important that all the pieces of fiscal decentralization are in the plan from the beginning (Bahl and Bird 2018).…”

“…A typical mistake that governments make is changing certain aspects of the intergovernmental fiscal framework in isolation; for example, modifying expenditure mandates, introducing new revenue-sharing schemes, or changing the transfer system. If they are not part of a comprehensive framework, such isolated changes may eventually create inconsistencies across government levels, undermining the effectiveness of fiscal policy and increasing macroeconomic risks (Fedelino andTer-Minassian 2009, andGoerl andSeiferling 2014). In addition, there are various tradeoffs involved in designing decentralization, so it must be tailored to the priority goals and circumstances of each country (Prud'Home 2003).…”

Improving fiscal federal relations for a stronger Mexico

“…A clear and transparent public financial management framework at the sub-national level is a key ingredient for effective fiscal decentralisation and public management (Fedelino and Ter-Minassian, 2010). It facilitates consistent decision-making to ensure macroeconomic stability and accountability for an effective use of public money.…”

Multi‐Level Governance and the Environment: Intergovernmental Relations and Innovation in Environmental Policy

“…Rather than zero-sum games, they evolve towards patterns of multi-level governance, where central and local levels of governments are increasingly differentiated as well as interdependent. This joint evolution, whereby the differentiation between the levels of governments and the densification of their interaction come together, has been a fundamental element in the transformations of public policy (Loughlin, 2001;Saito, 2008;Fedelino and Ter-Minassian, 2010;Dickovick, 2011).It is also worth noting that this evolution, initiated in the 1970s and accelerated thereafter, occurred in parallel with the introduction of environmental policy and politics, under the joint pressure of industrialization and urbanization. Developed and then developing countries created protection agencies or ministries, and initiated a…”