IDEAS home Printed from https://ideas.repec.org/p/eab/microe/22943.html
   My bibliography  Save this paper

Determining General and Specific Purpose Transfers : An Integrated Approach

Author

Listed:
  • Richa Saraf

    (MSE)

  • D.K.Srivastava

Abstract

This study attempts to provide an alternative methodology to calculate the horizontal equalization transfers. This methodology follows the Australian horizontal equalization principle using a panel model methodology where both revenue and expenditure side considerations are involved. First, it applies the Canadian model in calculating the fiscal capacity equalization. Then the expenditure side equalization has been carried out for two services - education and health. Results of the exercise indicate that the transfers suggested by the panel model are more progressive than the TFC recommended transfers.

Suggested Citation

  • Richa Saraf & D.K.Srivastava, 2009. "Determining General and Specific Purpose Transfers : An Integrated Approach," Microeconomics Working Papers 22943, East Asian Bureau of Economic Research.
    • Handle: RePEc:eab:microe:22943
    as

    Download full text from publisher

    File URL: http://www.eaber.org/node/22943
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Robin W. Boadway & Frank R. Flatters, 1982. "Efficiency and Equalization Payments in a Federal System of Government: A Synthesis and Extension of Recent Results," Canadian Journal of Economics, Canadian Economics Association, vol. 15(4), pages 613-633, November.
    2. James M. Buchanan & Richard E. Wagner, 1970. "An Efficiency Basis for Federal Fiscal Equalization," NBER Chapters, in: The Analysis of Public Output, pages 139-162, National Bureau of Economic Research, Inc.
    3. Rangarajan, C. & Srivastava, D.K., 2004. "Fiscal transfer in Canada: Drawing comparisons and lessons," Working Papers 04/18, National Institute of Public Finance and Policy.
    4. Ross Garnaut, 2002. "Equity and Australian Development: Lessons from the First Century," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(3), pages 227-243, September.
    5. Rangarajan, C. & Srivastava, D.K., 2004. "Fiscal transfer in Australia: Review and relevance to India," Working Papers 04/20, National Institute of Public Finance and Policy.
    6. Ross Garnaut & Vince FitzGerald, 2002. "Issues in Commonwealth–State Funding," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(3), pages 290-300, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. K. Shanmugam & K. R. Shanmugam, 2022. "Equalisation Transfers Based on Spending Needs and Fiscal Capacity of State Governments in India," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 16(2), pages 139-165, May.
    2. Jyotsna Rosario & K. R. Shanmugam, 2023. "Impact of transfers on elementary education expenditure and measuring equalisation transfers to Indian States," Indian Economic Review, Springer, vol. 58(1), pages 141-168, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Richa Saraf & D K Srivastava, 2009. "Determining General And Specific Purpose Transfers: An Integrated Approach," Working Papers 2009-040, Madras School of Economics,Chennai,India.
    2. D. K. Srivastava, 2006. "Equalizing Health and Education : Approach of the Twelfth Finance Commission," Finance Working Papers 22517, East Asian Bureau of Economic Research.
    3. D. K. Srivastava, 2006. "Equalizing Health and Education: Approach of the Twelfth Finance Commission," Working Papers 2006-08, Madras School of Economics,Chennai,India.
    4. Jorge Martinez-Vazquez & Cristian Sepulveda, 2012. "Toward a More General Theory of Revenue Assignments," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1231, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    5. Jorge Martinez-Vazquez & Cristian Sepulveda, 2020. "A Theoretical Rationale for the Fiscal-Gap Model of Equalization Transfers," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 76(1), pages 1-28.
    6. Albouy, David, 2012. "Evaluating the efficiency and equity of federal fiscal equalization," Journal of Public Economics, Elsevier, vol. 96(9-10), pages 824-839.
    7. C. Rangarajan & D. K. Srivastava, 2008. "Reforming India’s Fiscal Transfer System : Resolving Vertical and Horizontal Imbalances," Finance Working Papers 22509, East Asian Bureau of Economic Research.
    8. Wallace E. Oates, 2006. "On the Theory and Practice of Fiscal Decentralization," Working Papers 2006-05, University of Kentucky, Institute for Federalism and Intergovernmental Relations.
    9. C. Rangarajan & D. K. Srivastava, 2008. "Reforming India’S Fiscal Transfer System: Resolving Vertical And Horizontal Imbalances," Working Papers 2008-031, Madras School of Economics,Chennai,India.
    10. Wallace E. Oates, 2006. "On the Theory and Practice of Fiscal Decentralization," Working Papers 2006-05, University of Kentucky, Institute for Federalism and Intergovernmental Relations.
    11. Emanuel Kohlscheen, 2008. "Debt Bailouts And Constitutions," Economic Inquiry, Western Economic Association International, vol. 46(3), pages 480-492, July.
    12. Suzuki, Takafumi, 2021. "Capitalization of local government grants on land values: Evidence from Tokyo metropolitan area, Japan," Japan and the World Economy, Elsevier, vol. 60(C).
    13. Boadway, Robin & Song, Zhen & Tremblay, Jean-François, 2013. "Non-cooperative pollution control in an inter-jurisdictional setting," Regional Science and Urban Economics, Elsevier, vol. 43(5), pages 783-796.
    14. Mitsui, Kiyoshi & Sato, Motohiro, 2001. "Ex ante free mobility, ex post immobility, and time consistency in a federal system," Journal of Public Economics, Elsevier, vol. 82(3), pages 445-460, December.
    15. Michael Smart, 2007. "Raising taxes through equalization," Canadian Journal of Economics, Canadian Economics Association, vol. 40(4), pages 1188-1212, November.
    16. Strain, J. Frank, 1993. "Integration, Federalism and Cohesion in the European Community: Lessons from Canada," Research Series, Economic and Social Research Institute (ESRI), number PRS16.
    17. Hindriks, Jean & Peralta, Susana & Weber, Shlomo, 2008. "Competing in taxes and investment under fiscal equalization," Journal of Public Economics, Elsevier, vol. 92(12), pages 2392-2402, December.
    18. Mark D. Partridge & Dan S. Rickman & M. Rose Olfert & Ying Tan, 2015. "When Spatial Equilibrium Fails: Is Place-Based Policy Second Best?," Regional Studies, Taylor & Francis Journals, vol. 49(8), pages 1303-1325, August.
    19. Robin Boadway & Motohiro Sato & Jean-François Tremblay, 2018. "Natural Resource Extraction in a Federation," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 74(1), pages 34-51, March.
    20. Harrie A. A Verbon, 2007. "Migrating Football Players, Transfer Fees and Migration Controls," CESifo Working Paper Series 2004, CESifo.

    More about this item

    Keywords

    horizontal equalization transfers; education; health; fiscal capacity equalization;
    All these keywords.

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D30 - Microeconomics - - Distribution - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eab:microe:22943. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Shiro Armstrong (email available below). General contact details of provider: https://edirc.repec.org/data/eaberau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.