Financial autonomy and consistency of central government policy towards local governments

In: International review of administrative sciences: an international journal of comparative public administration, Band 75, Heft 2, S. 311-332

Abstract

Traditionally, empirical assessment of local government financial autonomy has concentrated on the different income sources available to local governments. In this article we extend such evaluation to the expenditure autonomy side and combine these two dimensions of autonomy into a comprehensive evaluation of local government financial autonomy. The operationalization of financial autonomy offers a basis for an evaluation of the consistency of central government policy towards local governments. Our approach is then used for a comparison of two countries — Finland and Poland. Points for practitioners Key implications in our approach are the systematic evaluation of both income and expenditure autonomy of local governments, and combining these two dimensions of autonomy into a comprehensive evaluation of local government financial autonomy. The measurement of financial autonomy which is developed can be used as a management tool in central government policy towards local governments.