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- Title
Determinants of Local Government Deficit and Debt: Evidence from Polish Municipalities.
- Authors
DZIAŁO, JOANNA; GUZIEJEWSKA, BEATA; MAJDZIŃSKA, ANNA; ŻÓŁTASZEK, AGATA
- Abstract
Public finance theory stresses that some political and socioeconomic factors exist that influence local government deficits and debts. Accordingly, our study analyses the factors that determine the indebtedness in Polish local governments. We analyse the population of Polish municipalities (2,479) for the years 2002-2016. The method of investigation is a two-equation microeconometric panel model with fixed effects, allowing us to estimate the strength and directions of the exogenous variables' influence on the communes' budget balance (deficit/surplus). Our findings reveal the influence of variables such as the communes' investment expenditures and own incomes, a dependent population (a high share of the older population), and the number of companies. We also find that the election cycle in local governments is a significant factor affecting their budget outcomes.
- Subjects
POLAND; PUBLIC debts; LOCAL government; FIXED effects model; LOCAL elections; PUBLIC finance
- Publication
Lex Localis: Journal of Local Self-Government, 2019, Vol 17, Issue 4, p1033
- ISSN
1581-5374
- Publication type
Article
- DOI
10.4335/17.4.1033-1056(2019)