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Fiscal Capacities of Large Cities in Croatia – Financial Support for Smart Cities

Author

Listed:
  • Hodžić Sabina

    (University of Rijeka, Faculty of Tourism and Hospitality Management, Opatija, Croatia)

  • Paleka Hana

    (University of Rijeka, Faculty of Tourism and Hospitality Management, Opatija, Croatia)

Abstract

In a dynamic market, the city has become a main source of competitiveness, along with financial and economic benefits. Due to the processes of digitalization, a new concept has been developed, namely smart cities. This concept delivers economic and financial potential, not only to cities, but also to urban and local economic development. Therefore, to ensure the establishment of this concept, local government units, i.e., cities, need to have enough financial resources. In addition, the fiscal capacity of their local budgets should be sufficient. The objective of this paper is to evaluate the fiscal capacity of large cities in Croatia over the 2016-2018 period, as well as to present the financial support through funding schemes for the establishment of smart cities. After calculating the level of fiscal capacity of large cities, the analysis revealed interesting results. Only four large cities (Split, Rijeka, Zadar and Pula) achieved positive fiscal capacity in the observed period. This provides evidence of fiscal performance and fiscal capacity for the establishment of smart cities. This concept will enhance the quality of life, stimulate economic growth, sustain local government budgets and create new value for both investors and the local population.

Suggested Citation

  • Hodžić Sabina & Paleka Hana, 2020. "Fiscal Capacities of Large Cities in Croatia – Financial Support for Smart Cities," Naše gospodarstvo/Our economy, Sciendo, vol. 66(2), pages 42-49, June.
    • Handle: RePEc:vrs:ngooec:v:66:y:2020:i:2:p:42-49:n:4
    DOI: 10.2478/ngoe-2020-0010
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    References listed on IDEAS

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    1. Tuba Bakıcı & Esteve Almirall & Jonathan Wareham, 2013. "A Smart City Initiative: the Case of Barcelona," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 4(2), pages 135-148, June.
    2. Rosario Ferrara, 2015. "The Smart City and the Green Economy in Europe: A Critical Approach," Energies, MDPI, vol. 8(6), pages 1-11, May.
    3. Dubravka Jurlina Alibegovic & Zeljka Kordej-De Villa & Mislav Sagovac, 2018. "Smart City Indicators: Can They Improve Governance in Croatian Large Cities?," Working Papers 1805, The Institute of Economics, Zagreb.
    4. Margaret Chitiga-Mabugu & Nara Monkam, 2013. "Assessing Fiscal Capacity at the Local Government Level in South Africa," Working Papers 201376, University of Pretoria, Department of Economics.
    5. Vito Albino & Umberto Berardi & Rosa Maria Dangelico, 2015. "Smart Cities: Definitions, Dimensions, Performance, and Initiatives," Journal of Urban Technology, Taylor & Francis Journals, vol. 22(1), pages 3-21, January.
    6. Liviu Gabriel CRETU, 2012. "Smart Cities Design using Event-driven Paradigm and Semantic Web," Informatica Economica, Academy of Economic Studies - Bucharest, Romania, vol. 16(4), pages 57-67.
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    More about this item

    Keywords

    local government; smart cities; fiscal capacity; local economic development;
    All these keywords.

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • R51 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Finance in Urban and Rural Economies

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