For a successful fiscal decentralization a proper harmonization of the local autonomy and accountability is needed. Even though the participatory government makes its utmost efforts to enhance the local autonomy and accountability, the vertical and ho...
For a successful fiscal decentralization a proper harmonization of the local autonomy and accountability is needed. Even though the participatory government makes its utmost efforts to enhance the local autonomy and accountability, the vertical and horizontal redistribution of local revenue sources should be a matter calling for prior settlement. 'Fiscal Sunset Clause' could be a method to improve the vertical and horizontal inequalities of local finances on one hand, and strengthen the local autonomy and accountability on the other hand. By this mechanism moral hazards and X-inefficiency can be minimized in the process of enforcing the local autonomy and accountability.