The Challenge of Fiscal Adjustment in a Democracy: The Case of India

Hausmann, Ricardo; Purfield, Catriona

doi:10.5089/9781451858297.001

Cited by 15 publications

(30 citation statements)

References 16 publications

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“…Purfield, 2003;Hausmann and Purfield, 2004). The latter paper picturesquely compares it to what happens when an individual goes to a restaurant in a group and orders lobster, whereas if he were alone, he would have ordered a cheaper item, chicken.…”

Section: Assessment and Policy Optionsmentioning

confidence: 99%

“…27 In addition to reforms in tax and transfer systems as ways of reducing subnational fiscal deficits, an important area of reform relates to the process of borrowing by the states, which has hitherto been ad hoc and opaque. Improvements in financial information, budgeting and accounting practices, regulatory norms and monitoring are all required here, as well as changes in the institutional rules (IMF, 2003;Hausmann and Purfield, 2004). These reforms parallel many of those required for India's financial sector as a whole: state governments just happen to be among the most powerful of those entities taking advantage of poorly functioning credit markets to run up unpaid debts.…”

Section: Deficits and Debtmentioning

confidence: 99%

“…More recently, six other states have followed. 26 Coordinated and uniform implementation of the state laws (Kopits, 2001) would help control externalities or free-riding behavior, given that enforcement provisions are weak in the Indian case (Hausmann and Purfield, 2004;Howes, 2005), but the approach of individual states choosing their own provisions may be the most practicable. The Twelfth Finance Commission does provide some coordination by recommending minimum provisions for state level FRBM laws.…”

Section: Deficits and Debtmentioning

confidence: 99%

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State Finances in India: A Case for Systemic Reform

Singh

2006

SSRN Journal

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This paper provides a self-contained overview of the present problems of state finances in India. It begins with an overview of historical evolution and current institutional structures, including economic, political, administrative and fiscal aspects of India's federal system. The paper then reviews the current situation of India's state government finances, going on to consider various developments that have shaped the states' current fiscal situation, including the roles of national economic reform, the intergovernmental transfer system, tax reform, and local government reform. Policy options for reforming institutions of fiscal federalism system, borrowing mechanisms for the states, and governance are then discussed, with an emphasis on the principle that states should have appropriate incentives for fiscal discipline at the margins of revenue and expenditure.JEL codes: H1, H7, P2

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Section: Assessment and Policy Optionsmentioning

confidence: 99%

Section: Deficits and Debtmentioning

confidence: 99%

Section: Deficits and Debtmentioning

confidence: 99%

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State Finances in India: A Case for Systemic Reform

Singh

2006

SSRN Journal

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“…43 See Catão and Kapur (2004). 44 See Hausmann and Purfield (2004). 45 See Barnhill and Kopits (2003).…”

Section: Sovereign Crisis Literaturementioning

confidence: 99%

Assessing Fiscal Soundness: Theory and Practice

et al. 2006

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“…27 See for example Ter-Minassian (2005) and Singh and Plekhanov (2005). 28 See for example Anand et al (2004), Hausmann and Purfield (2004), Purfield and Flanagan (2006). 29 The constitutional assignment of expenditure responsibilities and revenue authority between the central and state government is intentionally imbalanced to enable regional redistribution by the central government (see Khemani, 2007).…”

mentioning

confidence: 99%