Post-decentralization fiscal behavior of metropolitan Manila local governments: has there been a change?
Date
2003-04-03
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Abstract
Has there been a change in the fiscal behavior of the 17 Metro Manila local governments after decentralization? This paper intends to answer this main question using panel data analyses. We look at the fiscal behavior of local governments with respect to local revenue mobilization, expenditure allocation, and fiscal balance maintenance, before and after decentralization. The overall results that emerge suggest consequential changes in the fiscal behavior of Metro Manila local governments. On the local revenue-raising behavior, different clusters of local governments (original cities, newly-converted cities, and municipalities) have responded differently to higher intergovernmental grant (Internal Revenue Allotment). On the expenditure side, there has been a significant shift in expenditure priority from economic services to social services. And on the overall fiscal balance, a majority of the local governments increased their average fiscal surpluses (in absolute terms and as percent of total expenditures), though some have become less fiscally responsible.
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Decentralization, Fiscal behavior, Local government, Metropolitan Manila, Public finance