השפעת מענקי הממשלה על תקציב הרשויות המקומיות

Translated title of the contribution: The Effects of Intergovernmental Transfers on Municipalities’ Budget

Research output: Contribution to journalArticlepeer-review

Abstract

This study estimates the effects of equalization grants and intergovernmental transfers to finance education and welfare on local government expenditures, local revenues, and local budget deficit based on a panel data on 258 municipalities for the years 2005–2017. I found that an increase of 100 Shekels in equalization grants, which constitutes one fifth of total expenditures in disadvantaged municipalities, is associated with a rise of 82 Shekels.That size effect is different depending on the particular expenditure. The biggest effect of equalization grants is on education and municipal spending, and in particular on transitory expenditures such as paying debt. In addition, this study reveals that equalization grantsare used to reduce local budget deficit. As expected, the effects of intergovernmental transfers to finance welfare spending is greater intergovernmental transfers to finance education. It reflects the binding matching requirement associated with welfare spending.
Translated title of the contributionThe Effects of Intergovernmental Transfers on Municipalities’ Budget
Original languageHebrew
Pages (from-to)97-125
Number of pages29
Journalרבעון לכלכלה
Volume65
Issue number1-2
StatePublished - 2021

IHP publications

  • ihp
  • Central-local government relations

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