PRIORITIES FOR THE DISTRIBUTION OF INTERBUDGETARY TRANSFERS UNDER THE CONDITIONS OF FISCAL DECENTRALIZATION IN UKRAINE
The article is devoted to the problem of the distribution of intergovernmental transfers in Ukraine, taking into account fiscal decentralization trends. To perform the delegated functions, local governments need to have sufficient funding. However, the revenues of local budgets are insufficient to cover all necessary expenses. Therefore, inter-budget transfers, which in Ukraine are the main instrument of financial equalization, play an important role in ensuring the implementation of delegated powers by local governments. The aim of the article is determination of the priorities for the distribution of intergovernmental transfers in Ukraine in the context of fiscal decentralization. The research methodology combines quantitative and qualitative methods. Using quantitative methods, the principles of fiscal decentralization in Ukraine are observed through the mechanism of distribution of intergovernmental transfers. Using high-quality methods and based on the analysis, the priorities of the distribution of inter-budget transfers in the context of fiscal decentralization are formulated. An analysis of foreign publications on fiscal decentralization has shown that the uncertainty of priorities in this area reduces the effectiveness of fiscal decentralization and inhibits the economic development of regions. Prioritization of the distribution of intergovernmental transfers is preceded by the definition of principles for the distribution of intergovernmental transfers. Based on the results of a quantitative analysis, namely, the identified dynamics of fiscal decentralization indicators and the impact of the distribution of intergovernmental transfers on economic development, the following priorities for the distribution of intergovernmental transfers in fiscal decentralization are identified: supporting the prevalence of targeted transfers over non-targeted transfers, increasing the share of capital transfers, increasing the accountability of local authorities self-government regarding the use of funds received in the form of intergovernmental budget transfers.
Lysenko, O. Yu. (2011). Mizhbiudzhetni vidnosyny v Ukraini: osoblyvosti rozvytku ta shliakhy udoskonalennia. Visnyk Natsionalnoi akademii derzhavnoho upravlinnia pry Prezydentovi Ukrainy, 1, 1–8.
Doslidzhennia Instytutu demohrafii ta sotsialnykh doslidzhen NANU. Available at: http://www.idss.org.ua/
Kuzmynchuk, N. V., Zyma, O. H. (2013). Analiz vydiv mizhbiudzhetnykh transfertiv shchodo vyrishennia rehionalnykh problem formuvannia biudzhetiv. Problemy ekonomiky, 4, 198–205.
Filippetti, A., Sacchi, A. (2016). Decentralization and economic growth reconsidered: The role of regional authority. Environment and Planning C: Government and Policy, 34 (8), 1793–1824. doi: http://doi.org/10.1177/0263774x16642230
Martinez-Vazquez, J., Lago-Peñas, S., Sacchi, A. (2016). The impact of fiscal decentralization: a survey. Journal of Economic Surveys, 31 (4), 1095–1129. doi: http://doi.org/10.1111/joes.12182
Baskaran, T. (2009). On the link between fiscal decentralization and public debt in OECD countries. Public Choice, 145 (3-4), 351–378. doi: http://doi.org/10.1007/s11127-009-9570-4
Lelechenko, A. P. (2006). Detsentralizatsiia v systemi derzhavnoho upravlinnia v Ukraini: teoretyko-metodolohichnyi analiz. Kyiv, 20.
Oates Wallace, E. (1972). Fiscal Federalism. New York: Harcourt Brace Jovanovich, 256.
Oates, W. E. (1979). Lump-sum intergovernmental grants have price effects. Fiscal federalism and grants-in-aid. Washington: Urban Institute
Boadway, R. (2001). Inter_Governmental fiscal relations: The facilitator of fiscal decentralization. Constitutional political economy, 12, 93–121. doi: http://doi.org/10.1023/a:1016693903035
Keen, M., Konrad, K. A.; Auerbach, A. J., Chetty, R., Feldstein, M., Saez, E. (Eds.) (2013). The Theory of International Tax Competition and Coordination. Handbook of Public Economics. Vol. 5. Elsevier, 257–328. doi: http://doi.org/10.1016/b978-0-444-53759-1.00005-4
Agrawal, D. R., Foremny, D. (2019). Relocation of the Rich: Migration in Response to Top Tax Rate Changes from Spanish Reforms. The Review of Economics and Statistics, 101 (2), 214–232. doi: http://doi.org/10.1162/rest_a_00764
Besley, T., Coate, S. (2003). Centralized versus decentralized provision of local public goods: a political economy approach. Journal of Public Economics, 87 (12), 2611–2637. doi: http://doi.org/10.1016/s0047-2727(02)00141-x
Albouy, D. (2010). Evaluating the Efficiency and Equity of Federal Fiscal Equalization. NBER Working Paper, No. 16144. doi: http://doi.org/10.3386/w16144
Blöchliger, H., Petzold, O. (2009). Taxes or Grants: What Revenue Sources for Sub-central Governments? OECD Economics Department Working Papers, No. 704. Paris.
Buettner, T. (2003). Tax base effects and fiscal externalities of local capital taxation: evidence from a panel of German jurisdictions. Journal of Urban Economics, 54 (1), 110–128. doi: http://doi.org/10.1016/s0094-1190(03)00039-1
Francois, I. (2010). Sub-central Tax Competition: the French Case, presentation to the Workshop on Tax Competition. Bern.
Dabla-Norris, E., Wade, P. (2002). The Challenge of Fiscal Decentralization in Transition Countries. IMF Working Paper WP/02/103. doi: http://doi.org/10.5089/9781451852707.001
Meloni, O. (2016). Electoral Opportunism and Vertical Fiscal Imbalance. Journal of Applied Economics, 19 (1), 145–167. doi: http://doi.org/10.1016/s1514-0326(16)30006-x
Oto-Peralías, D., Romero-Ávila, D., Usabiaga, C. (2013). Does fiscal decentralization mitigate the adverse effects of corruption on public deficits? European Journal of Political Economy, 32, 205–231. doi: http://doi.org/10.1016/j.ejpoleco.2013.07.005
World Bank (2012). Anticorruption. Costs and consequences of corruption” World Bank. Washington.
Rodden, J. (2002). The Dilemma of Fiscal Federalism: Grants and Fiscal Performance around the World. American Journal of Political Science, 46 (3), 670–687. doi: http://doi.org/10.2307/3088407
Volden, C. (2007). Intergovernmental Grants: A Formal Model of Interrelated National and Subnational Political Decisions. Publius: The Journal of Federalism, 37 (2), 209–243. doi: http://doi.org/10.1093/publius/pjl022
Forkun, I., Hordieieva, T. (2017). Mizhbiudzhetni vidnosyny ta systema biudzhetnoho rehuliuvannia v Ukraini. Visnyk Khmelnytskoho natsionalnoho universytetu, 5, 261–267.
Kaletnyk, O. V. (2016). Mizhbiudzhetni transferty v umovakh biudzhetnoi detsentralizatsii v Ukraini. Studentskyi Visnyk natsionalnoho universytetu vodnoho hospodarstva ta pryrodokorystuvannia, 1 (6), 122–125.
Derzhavna Kaznacheiska Sluzhba Ukrainy. Available at: https://www.treasury.gov.ua/ua
Derzhavna sluzhba statystyky Ukrainy. Available at: http://www.ukrstat.gov.ua/
Pysmennyi, V. V. (2013). Problemy realizatsii pryntsypiv orhanizatsii mistsevykh finansiv u vitchyznianii praktytsi. Svit finansiv, 1, 87–94.
Zakonodavche zabezpechennia vprovadzhennia reformy mistsevoho samovriaduvannia ta detsentralizatsii vlady: osnovni dosiahnennia ta problemni aspekty. Analitychna zapyska. Available at: http://old2.niss.gov.ua/content/articles/files/samovriaduv-e4ff2.pdf
Volokhova, I. S. (2010). Mizhbiudzhetni vidnosyny v Ukraini: suchasnyi stan ta perspektyvy rozvytku. Odesa: Atlant, 234.
Copyright (c) 2020 Yana Sarnetska
This work is licensed under a Creative Commons Attribution 4.0 International License.
Our journal abides by the Creative Commons CC BY copyright rights and permissions for open access journals.
Authors, who are published in this journal, agree to the following conditions:
1. The authors reserve the right to authorship of the work and pass the first publication right of this work to the journal under the terms of a Creative Commons CC BY, which allows others to freely distribute the published research with the obligatory reference to the authors of the original work and the first publication of the work in this journal.
2. The authors have the right to conclude separate supplement agreements that relate to non-exclusive work distribution in the form in which it has been published by the journal (for example, to upload the work to the online storage of the journal or publish it as part of a monograph), provided that the reference to the first publication of the work in this journal is included.