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Coping with Change: The Need to Restructure Urban Governance and Finance in India

Author

Listed:
  • M. Govinda Rao
  • Richard M. Bird

    (Institute on Municipal Finance and Governance)

Abstract

Over 330 million people live in India’s 5,165 cities, and 35 cities have a population of over a million each. Three (Mumbai, Delhi, and Kolkata) of the 10 largest metropolises in the world are in India. Over two-thirds of India’s GDP originates in urban agglomerations in the country. However, urban governance and finance in India leave much to be desired in terms of providing services to the country’s burgeoning urban population while accommodating different needs and pressures and adapting to shocks, whether natural or human-caused. This paper draws on lessons from fiscal federalism theory and the experiences of governance institutions and financing systems around the world to identify some key reforms needed to ensure more citizen participation and greater accountability in urban governance, and to augment and strengthen the capacity of Indian cities to deliver more adequate services and provide needed urban infrastructure.

Suggested Citation

  • M. Govinda Rao & Richard M. Bird, 2011. "Coping with Change: The Need to Restructure Urban Governance and Finance in India," IMFG Papers 04, University of Toronto, Institute on Municipal Finance and Governance.
    • Handle: RePEc:mfg:wpaper:04
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    References listed on IDEAS

    as
    1. Simanti Bandyopadhyay & M. Govinda Rao, 2009. "Fiscal Health of Selected Indian Cities," Development Economics Working Papers 22970, East Asian Bureau of Economic Research.
    2. R. Kavita Rao, 2008. "Goods and Services Tax for India," Macroeconomics Working Papers 22976, East Asian Bureau of Economic Research.
    3. Slack, Enid, 2007. "Managing the coordination of service delivery in metropolitan cities : the role of metropolitan governance," Policy Research Working Paper Series 4317, The World Bank.
    4. János Kornai, 2014. "The soft budget constraint," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 64(supplemen), pages 25-79, November.
    5. Breton,Albert, 1998. "Competitive Governments," Cambridge Books, Cambridge University Press, number 9780521646284, January.
    6. Engel, Eduardo & Fischer, Ronald & Galetovic, Alexander, 2010. "The economics of infrastructure finance: Public-Private Partnerships versus public provision," EIB Papers 2/2010, European Investment Bank, Economics Department.
    7. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64(5), pages 416-416.
    8. Richard M Bird & Andrey V Tarasov, 2004. "Closing the Gap: Fiscal Imbalances and Intergovernmental Transfers in Developed Federations," Environment and Planning C, , vol. 22(1), pages 77-102, February.
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    11. Robert P. Inman & Daniel L. Rubinfeld, 1997. "Rethinking Federalism," Journal of Economic Perspectives, American Economic Association, vol. 11(4), pages 43-64, Fall.
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    Citations

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    Cited by:

    1. Sundaresan, Jayaraj, 2017. "Urban planning in vernacular governance: land use planning and violations in Bangalore, India," LSE Research Online Documents on Economics 86388, London School of Economics and Political Science, LSE Library.
    2. Simanti Bandyopadhyay, 2014. "Municipal Finance in India: Some Critical Issues," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1421, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    3. Jonas Frank & Jorge Martinez-Vazquez, 2014. "Decentralization And Infrastructure: From Gaps To Solutions," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1405, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    4. Simanti Bandyopadhyay, 2014. "Some New Thoughts on Performance Evaluation of Governments: An Application to Indian Cities," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1430, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    5. Simanti Bandyopadhyay, 2015. "Financial management and service delivery: a nonparametric analysis for Indian cities," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 54(3), pages 721-751, May.

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    More about this item

    Keywords

    India; metropolitan areas; governance; finance;
    All these keywords.

    JEL classification:

    • R5 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis
    • H1 - Public Economics - - Structure and Scope of Government
    • H7 - Public Economics - - State and Local Government; Intergovernmental Relations

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