Municipal Finance in Transitional Countries

Abstract

This paper looks at how municipalities are financed in transitional and non-traditional economies. Transitional economies are moving from a traditional, planned or regulated economy to a free market economy. Transitional economies are also undergoing economic liberation by letting market forces set prices. These economies undergo restructuring and privatization by moving from the public to the private ownership of resources. The transition process leads to private property rights which are the basic element of a free market economy. Transitional economies are found in Asia, Central and Eastern Europe, Africa and Central and South America.