What is in it for the poor? Evidence from fiscal decentralization in Vietnam

Nguyen, Hoang-Phuong (2008): What is in it for the poor? Evidence from fiscal decentralization in Vietnam. Published in: Journal of Public and International Affairs No. 19 (June 2008): pp. 69-90.

Abstract

Like other developing countries, Vietnam has attempted to push for greater fiscal decentralization in the hope of a more efficient delivery of social services to targeted citizens. The fiscal decentralization initiative is encouraging and merits pursuit, but the present study however, shows that a misstep in the decentralization process can discriminate disproportionately against the poor. Specifically, an increase in the sub-provincial share of the total provincial expenditures is predicted to bring about an appreciable decrease in the lowest-quintile average monthly income. We suggest that the Vietnamese government require provinces to adopt pro-poor allocation norms rather than reclaiming its control over the provincial expenditure assignment. This paper’s empirical findings sound a note of considerable caution that other developing countries should exercise in their fiscal decentralization efforts to avoid creating unintended consequences for the poor.

• Item Type: MPRA Paper
• Language: English
• Keywords: Fiscal decentralization; Vietnam; poverty reduction
• Subjects: H - Public Economics > H8 - Miscellaneous Issues > H87 - International Fiscal Issues ; International Public Goods; H - Public Economics > H8 - Miscellaneous Issues > H83 - Public Administration ; Public Sector Accounting and Audits

References

Nguyen, Hoang-Phuong, (2008). What is in it for the poor? Evidence from fiscal decentralization in Vietnam. Journal of Public and International Affairs, 19.