By Steven B. Webb, Marcelo M. Giugale

The 3 forces of democratization, decentralization, and improvement have swept internationally the decade and redrawn the maps of politics, strength, and prosperity. sleek Mexico has been totally engaged within the trio, making it a wealthy case learn. in recent times, stronger political pageant has redistributed decisionmaking throughout all degrees of presidency, making the govt extra in charge to the typical citizen. It has additionally given subnational governments a renewed position as fiscal brokers. The taxation, spending, borrowing, and associations of Mexican states and municipalities at the moment are more and more below the rigor of marketplace self-discipline. The mixed, nearer scrutiny of citizens and financiers is making a new incentive framework for policymakers-a framework the place priceless reforms turn into either inescapable and, extra importantly, a perceived resource of capability gift. This ebook is the fabricated from the analytical paintings of a big variety of specialists, Mexican and international. within the booklet, the specialists record Mexico's decentralization event; conceptualize its major tendencies, regulations, and strategies; and produce it into the sunshine of overseas comparability. They distill severe classes and demanding situations which are of relevance for Mexico, for Latin the US and, quite often, for international locations which are embarking on a long way attaining decentralization efforts. This renders the amount a massive contribution to our wisdom and pondering during this sector; and a well timed one, for the reason that decentralization is an irreversible method that's prone to proceed occupying policymakers for years yet to come.

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All other queries on rights and licenses should be addressed to the Office of the Publisher, World Bank, at the address above or faxed to 202-522-2422. Library of Congress Cataloging-in-Publication data has been applied for. Page iii Contents Acknowledgements ix List of Acronyms xi Preface Olivier Lafourcade xv Overview Marcelo Giugale, Vinh Nguyen, Fernando Rojas, and Steven B. Webb 1 Institutions for Decentralization 4 Spending and Service Delivery 11 Subnational Taxes and Revenue 15 Intergovernmental Transfers 19 Subnational Borrowing and Debt Management 23 Options and Agenda for Action 29 Medium- to Long-Term Agenda: 2001-2006 33 Perspectiva General Marcelo Giugale, Vinh Nguyen, Fernando Rojas, y Steven B.

In practice, states often demand less than the legal requirement from small and poor municipalities. Still, small municipalities doing an appropriate amount of reporting for their size should not be in a state of noncompliance. Large municipalities frequently do more than the minimum to satisfy the requirements of their own management or of their private sector creditors. Still, some larger cities have inadequate administration, even though they meet the letter of the law. The fiscal and administrative capacity of Mexico's 32 states also varies widely.

The state of Puebla has developed a series of agreements with its municipalities to concentrate and augment these resources at the state level and to provide a program of capacity building, based on a survey of local needs. The federal government is also planning new programs for supporting capacity building at state and local levels. There will Page 11 be pressure on these governments in order to improve their access to credit markets when these are reformed as described below. Civil service reform at subnational levels is needed and perhaps inevitable, but it will have limited success or impact while the old incentives remain in place.

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