Comparing Latin American and North American Subnational Government: Fiscal Autonomy and Accountability

Abstract

This paper explores fiscal decentralization in the Americas. It employs a comparative analysis to evaluate fiscal autonomy in North American and Latin American subnational government. Fiscal decentralization has been in vogue over recent decades, as nations have been adjusting to improve service delivery via decentralization. Decentralization (and autonomy) promises to attain various goals such as greater efficiency, equity, and accountability of governments. Fiscal decentralization has become a central topic of policy debate in Latin American countries, in particular, as part of a larger agenda of social-economic development in these countries. The paper is organized as follows. The second section will review related literature. The third section will present a basic framework of fiscal autonomy of subnational government and apply that framework for the analysis of subnational autonomy in Latin America and North America. The fourth section will explore factors that influence the extent of functional decentralization in the Americas. The fifth section will discuss implications for subnational accountability in an intergovernmental context. Conclusions will follow in the fifth section.