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Disparities in the Spending Needs of Highland Municipalities
Author(s) -
VALLÉSGIMÉNEZ JAIME,
ZÁRATEMARCO ANABEL
Publication year - 2011
Publication title -
public budgeting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.694
H-Index - 30
eISSN - 1540-5850
pISSN - 0275-1100
DOI - 10.1111/j.1540-5850.2011.00985.x
Subject(s) - subsidy , government spending , per capita , order (exchange) , public economics , government (linguistics) , population , local government , public spending , assertion , economics , development economics , business , economic growth , geography , political science , finance , linguistics , philosophy , demography , archaeology , sociology , politics , welfare , law , market economy , computer science , programming language
A certain rough consensus holds that highland municipalities have higher spending needs than others, because of the particularly adverse conditions in which they provide essential public services. However, there is no empirical evidence to support this assertion. This study examines whether any relevant differences actually exist in the spending policies of highland and lowland municipalities. To this end, we make logarithmic estimations of per capita municipal spending in order to determine whether the indicators selected, which are based on local government powers, adequately reflect spending needs. Our results point to the special circumstances of highland districts as a key explanatory factor for higher municipal spending, along with demographic factors, locational population patterns, economic activity, subsidies, and local fiscal capacity.