The Impact Of Local Budgetary Spending On Communities Development

Economic development within different countries has been seen in general as a task of central governments, especially in the case of unitary or more centralized states. According to a kind of “musgravian view” of public budget functions, central authorities were in many cases responsible for creation and implementation of comprehensive programs and policies, oriented to economic growth. However, despite this general approach, nowadays can be noticed that values as decentralization or subsidiarity are widely recognized, sustaining a trend of “glocalization”, within which local authorities are gaining and play a key role for regional development. Moreover, the move and the spirit of “Europe of Regions” are granting now to local authorities more means and importance in the field of economic development, considering them plenary actors of policy-making and its implementation. On this background, our paper aims to emphasize the impact of local budgetary spending on regional development, with a special accent on country differences. Based on data collected from Organization for Economic Co-operation and Development (OECD) Statistics and Eurostat databases, our findings suggest that strengthening the role of local authorities and improving the framework of their actions could lead to enhanced economic development at this level. Our findings and recommendations could be useful both for national and European authorities, in their efforts to improve regional policies in order to alleviate economic discrepancies.