Edited by Naoyuki Yoshino and Peter J. Morgan
Peter J. Morgan and Long Q. Trinh
Sustainable and inclusive growth in emerging Asian economies requires continued high levels of public sector investment in areas such as infrastructure, education, health, and social services. These responsibilities, especially with regard to infrastructure investment, need to be devolved increasingly to the regional government level. However, growth of sources of revenue and financing for local governments has not necessarily kept pace, forcing them, in some cases, to increase borrowing or cut spending below needed levels. This chapter reviews alternative models of the relationship between central and local governments, and provides an overview and assessment of different financing mechanisms for local governments, including tax revenues, central government transfers, bank loans, and bond issuance, with a focus on the context of emerging Asian economies. The chapter also reviews financing mechanisms for local governments and mechanisms for maintaining fiscal stability and sustainability at both the central and local government levels. Based upon the evidence on the decentralization process in Asia, it proposes some policy implications for improving central–local government relations and fiscal sustainability.
Edited by Michael G. Plummer, Peter J. Morgan and Ganeshan Wignaraja
Michael G. Plummer, Peter J. Morgan and Ganeshan Wignaraja
This chapter summarizes the overall purpose, background, major findings and policy recommendations in this book. The goal of this book is to identify the main constraints to South Asian–Southeast Asian economic integration, to provide specific policies that governments – together with the private sector and other development partners – should follow to overcome them, and to estimate the potential benefits and costs of those policies. It surveys the key issues, delineates existing bottlenecks and what can be done to resolve them, and considers the stakes involved, that is, the benefits and costs of deepening inter-regional links. It offers policy recommendations for governments, presents promising new approaches for regional institutions, identifies priority projects, and uses a computable general equilibrium model to estimate overall benefits and impacts of various scenarios of greater cross-regional integration. The chapter provides the historical background of integration between the two regions, and describes the current state of trade and investment integration. It then summarizes the findings of the chapters and, finally, synthesizes some of the main findings of the study and summarizes key policy recommendations.