Bagaka, Obuya (2008): Fiscal Decentralization in Kenya: The Constituency Development Fund and the Growth of Government. Published in: Proceedings of 20th Annual Conference of the Association for Budgeting and Financial Management October 23-25, 2008 – Chicago (November 2008)
Download (432Kb) | Preview
This paper explores the financial implications of fiscal decentralization policies on the central government's operating budget in Kenya. The paper evaluates how devolved funds under the constituency development fund (CDF) have been utilized to start healthcare capital projects (clinics) at the local level. The study finds that fiscal decentralization has promoted allocative efficiency and equity but at a cost of exporting tax burdens (operations and maintenance) to the central government emanating from capital projects implemented at the local level. The exported tax burdens have policy implications and call for reforms of the CDF program to reflect a benefit-expenditure structure.
|Item Type:||MPRA Paper|
|Original Title:||Fiscal Decentralization in Kenya: The Constituency Development Fund and the Growth of Government|
|Keywords:||fiscal decentralization; budget;devolution; constituency development fund; health care; allocative efficiency|
|Subjects:||H - Public Economics > H7 - State and Local Government; Intergovernmental Relations > H77 - Intergovernmental Relations; Federalism; Secession
H - Public Economics > H0 - General
H - Public Economics > H7 - State and Local Government; Intergovernmental Relations
H - Public Economics > H5 - National Government Expenditures and Related Policies
H - Public Economics > H2 - Taxation, Subsidies, and Revenue
A - General Economics and Teaching > A1 - General Economics > A10 - General
|Depositing User:||Obuya Bagaka|
|Date Deposited:||01. Dec 2008 14:52|
|Last Modified:||14. Feb 2013 20:58|
References • Bahl, Roy (1999). Implementation Rules For Fiscal decentralization. Economic Development Institute, World Bank.
• Bahl, Roy. On-line Article, “World Wide Trends in Fiscal Decentralization”. Accessed at http://www1.worldbank.org/wbiep/decentralization/library1/bahl1.htm accessed on 12/3/2007
• Bahl, Roy, Richard D. Gustley & Michael J. Wasylenko (1978) The Determinants of Local Government Police Expenditures: A Public Employment Approach. National Tax Journal, Vol. 31, No.1. pp. 67-79.
• Boadway, W. Robin & David E. Wildasin (1984). Public Sector Economics. 2nd edition. Little Brown and Company, Boston.
• Bradford D.F. R.A. Malt, & W. E. Oates (1969). The Rising Cost of Local Public Services: Some Evidence and Reflections. National Tax Journal, Vol. XXII, No. 2.
• Brennan, Geoffrey & James Buchanan (1980). The Power to Tax: Analytical Foundationsof a Fiscal Constitution. Cambridge University Press, Cambridge; New York.
• Burkhead, Jesse & Jerry, Miner (1971). Public Expenditure. Aldine, Publishing Company, New York.
• Coppedge, Michael (1999). Thickening Thin Concepts and Theories: Combining Large N and Small N in Comparative Politics. Comparative Politics, Vol. 31, No. 4, pp. 465-476.
• ______________ (2005) Explaining Democratic Deterioration in Venezuela Through Nested Induction. In The Third Wave of Democratization in Latin America. Edited by Hagopian, Frances and Scott, P. Mainwaring. Cambridge University Press, New York:
• David, Silverman (2005) Interpreting Qualitative Data- Methods for Analyzing Talk, Text and Interaction. 2nd ed. Sage Publications. London.
• Dennis, A. Rondinelli & Nellis, J.R. (1986). Assessing Decentralization Policies in Developing Countries: The Case for Cautious Optimism. Development Policy Review, Vol. 4, pp. 3-23.
• Economic Commission for Africa (ECA), (2004). “The Public Sector management 40 Reforms in Africa”. http://www.uneca.org
• Ebel, D. Robert & Serdar Yilmaz (2002). On the Measurement and Impact of Fiscal Decentralization. World Bank, Policy Research Working Paper No. 2809.
• Evans, S. Lieberman (2005). Nested Analysis as a Mixed Strategy for Comparative Research. American Political Science Review, Vol. 99, No. 3, pp. 435-452.
• Government of Kenya (GOK): CDF Allocations: http://www.cdf.go.ke Accessed on 3/4/2008.
• Government of Kenya (GOK) – Ministry of Finance (2001): Government Finance Statistics (GFS).
• Government of Kenya (GOK) – Ministry of Health (2008). Budget Estimate for a New Dispensary.
• Government of Kenya (GOK): Constituency Development Fund Act, 2003.
• Government of Kenya (GOK): Constituencies Development Fund Regulations, 2004. International Organization 57, pp. 695-729.
• GOK – Sessional Paper No. 1 of 1992 on Development and Employment in Kenya. March, 1992.
• GOK - Ministry of Planning and National Development (2005). “Geographical Dimensions of Well-being in Kenya – Who and Where are the Poor? A Constituency Level Profile, Vol. II.
• Gramlich, M. Edward (1988). “Intergovernmental Grants: A Review of the Empirical Literature”. Unpublished Paper. • Grossman, J. Philip (1989). Federalism and the Size of Government. Southern Economic Journal, Vol.55, No.3, pp.580-593. • Herbert, B. Asher (1983) Causal Modeling. 2nd ed. Sage Publications, Newbury Park.
• Herbert, J. Rubin & Rubin, Irene (2005). Qualitative Interviewing The Art of Hearing Data. 2nd Edition. Sage Publications. Thousand Oaks.
• Hood, Ron, David Husband & Fei Yu (2002). “Recurrent Expenditure Requirements of Capital Projects: Estimation for Budget Purposes.” The World Bank, Policy Working Paper, No. 2938.
• Jason Seawright & John Gerring (2008) Case Selection Techniques in Case Study 41 Research: A Menu of Qualitative and Quantitative Options. Political Science Quarterly, Vol. 61, No. 2, pp.294-308.
• John Gerring (2004). What is a Case Study and What Is It good for? The American Political Science Review, Vol. 98, No. 2, pp. 341-354.
• John, A. Vogt (2004). Capital Budgeting and Finance: A guide for Local Governments. International City/County Management Association.
• Joulfaian, David & Michael Marlow (1990). Government Size and Decentralization: Evidence from Disaggregated Data. Southern Economic Journal, Vol.56 , No.4, pp. 1094-1102.
• Kalaycioglu, Ersin (2000). Politics of Fiscal Decentralization. Intergovernmental Fiscal Relations & Local Financial Management Program, World Bank Institute.
• Kumar, Sharma Chanchal (2006). Decentralization Dilemma: Measuring the Degree and Evaluating the Outcomes. The Indian Journal of Political Science, Vol. LXVII, No.1.pp.51-64.
• Kwon, Osung (2003). The Effects of Fiscal Decentralization on Public Spending: The Korean Case. Public Budgeting & Finance.
• Lindaman, Kara & Kurt Thurmaier (2002). Beyond Efficiency and Economy: An Examination of Basic Needs and Fiscal Decentralization. Economic Development & Cultural Change, Vol. 50.
• Mark, Turner and Hulme David (1997). Governance, Administration & Development: Making the State Work. Kumarin Press, West Hartford, Connecticut.
• McClendon, J. McKee (2002) Multiple Regression and Causal Analysis. Waveland Press Inc. Long Grove, Illinois.
• Oates, Wallace (1972). Fiscal Federalism. Harcourt Brace Jovanovich, Inc.
• Oates, Wallace (1985). Searching the Leviathan: An Empirical Analysis. The American Economic Review, Vol. 75, No. 4, pp. 748-757.
• Oates, Wallace (1999). An Essay on Fiscal Federalism. Journal of Economic Literature. Vol. XXXVII, pp. 1120-1149.
• Robert L. Bland and Irene, Rubin (1997) Budgeting, A Guide for Local Governments. International City/County Management Association
• Rodden, Jonathan (2003). Reviving Leviathan: Fiscal Federalism and the Growth of Government.
• Russell, K. Schutt (2001). Investigating Social World – The Process and Practice of Research. 3rd ed. Pine Forge Press. Thousand Oaks.
• Smith, B. C. (1985). Decentralization: The Territorial Dimension of the State. George Allen Unwin, London.
• Stein, Ernesto (1998). Fiscal Decentralization and Government Size in Latin America. Inter-American Development Bank, Working Paper # 368.
• Tanzi, Vito (2000). Policies, Institutions and the Dark Side of Economics. Cheltenham, United Kingdom.
• Tanzi, Vito (2001). Pitfalls on the Road to Fiscal Decentralization. Global Policy Program. Working Paper, No. 19.
• Tanzi, Vito & Hamid Davoodi (1998). “Roads to Nowhere: How Corruption in Public Investment Hurts Growth.” Economic Issues, 12. International Monetary Fund.
• Tarrow, Sidney (2004). “Bridging the Quantitative – Qualitative Divide” in Rethinking Social Inquiry: Diverse Tools, Shared Standards. Edited by Brady, E. Henry & David,` Collier. Berkeley Public Policy Press and Rowman and Littlefield, Berkeley, CA.
• Tulia, Falleti (2005). A Sequential Theory of Decentralization: Latin American Cases in Comparative Perspective. American Political Science Review, Vol. 19, No. 3.