How Well Do Subnational Borrowing Regulations Work?

Jorge Martinez-Vazquez and Violeta Vulovic ()

No 563, ADBI Working Papers from Asian Development Bank Institute

Abstract: There are many positive aspects associated with subnational borrowing, including additional funding and promoting intergenerational equity. However, it may also endanger fiscal sustainability and macro stability due to moral hazard and soft budget constraints, making borrowing controls justified and common. This study reviews the different types of ex-ante and ex-post subnational borrowing regulations used in the international experience based on a large panel of developed and developing countries. Each type of regulations has advantages and disadvantages, with varying suitability to a country’s circumstances.

Keywords: borrowing regulations; fiscal sustainability; tax autonomy (search for similar items in EconPapers)
JEL-codes: H63 H70 H74 H81 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2016-04-03
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Related works:
Chapter: How well do subnational borrowing regulations work? (2017)
Working Paper: How Well Do Subnational Borrowing Regulations Work? (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:ris:adbiwp:0563

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