Cover -- Introduction to the Public Sector Governance and Accountability Series -- Title Page -- Contents -- Foreword -- Preface -- Acknowledgments -- Contributors -- Abbreviations -- Overview -- Introduction -- Part I: Macro Federalism -- Part II: Local Finance -- PART 1 Macro Federalism -- 1 Macro Federalism: An Introduction with Principal Reference to the Canadian Experience -- Introduction -- Globalization, Confederalism, and the Information-Knowledge Revolution -- Globalization -- Federalism and the internationalization of production -- The regional-international interface -- Confederalism -- The Information-Knowledge Revolution -- Defining Macro Federalism -- Outline of the Analysis -- Internal Economic Integration -- The Economic Integration Continuum -- Comparative Constitutional Approaches to Securing the Economic Union -- International Integration and the Internal Economic Union -- Conclusion -- Transfer Dependency: A Macro Federalism Approach to Regional Policy and Fiscal Federalism -- Transfers and Macro Federalism: A Gold-Standard Analogy -- A Geometry of the Macro Region Problem -- The separate currency area solution -- The optimal subsidy scheme -- Provincial strategies -- More on Regional Adjustment: The Blanchard-Katz Analysis -- Regional Stabilization -- Toward a Research Agenda -- Monetary Policy and Central Banking -- Fiscal Policy -- An Evaluation of the Maastricht Guidelines -- Miscellaneous Macro Federalism Issues -- The Environment and Macro Federalism -- Some Reflections on the International Dimension of Macro Federalism -- Paradiplomacy: An extension of the regional-international interface -- International agreements and the division of powers in federal nations -- Democracy Deficits and the Process of Global Confederalizing -- Overall Conclusions -- All Economics Is International.

Federalism as Structure versus Federalism as Process -- All Nations Are Now Federal -- Notes -- References -- 2 Globalization, the Information Revolution, and Emerging Imperatives for Rethinking Fiscal Federalism -- Introduction -- Governance Implications of Globalization and the Information Revolution -- Reorientation of the Nation-State, Emergence of Supranational Regimes, and Strengthening of Localization -- The Information Revolution and Citizen Empowerment -- Consumer Sovereignty and Democracy Deficit -- Internationalization of Cities and Regions -- Knowledge and International Competitiveness -- A Potential Source of Conflict within Nations -- Reorienting the State as a Counterweight to Globalization -- Localization -- Emerging Jurisdictional Realignments: Glocalization -- Emerging Governance Structure in the 21st Century -- Emerging Imperatives for Rethinking Fiscal Federalism -- Division of Fiscal Powers -- Diminishing economic relevance of the intermediate order of government, or toward an hourglass model of federalism -- New vision of local governance but growing resistance from state governments -- Bridging the Fiscal Divide within Nations -- Fiscal Prudence and Fiscal Discipline under "Fend-for-Yourself" Federalism -- Fragmentation of the Internal Common Market -- Failure of the Fiscal System to Provide Incentives for Responsive and Accountable Governance -- Federalism and Regional Equity: Reflections on Alternative Approaches to Reducing Regional Disparities -- Paternalism and Regional Equity: Building Transfer Dependencies? -- Partnership Approach to Regional Equity: Securing an Economic Union -- Preservation of the internal common market -- Tax harmonization and coordination -- Intergovernmental fiscal transfers -- Fiscal equalization -- Facilitating local access to credit.

Social risk management through transfer payments and social insurance -- Mitigating adverse consequences of globalization -- Concluding Remarks on Policies for Regional Development -- Conclusions: The New Vision of Multicentered Governance -- Notes -- References -- 3 Federalism and Macroeconomic Performance -- Introduction -- Institutional Environment for Macroeconomic Management -- Institutional Setting for Monetary Policy -- Monetary management in Brazil: A decade of successful reforms -- Monetary management in China: Still muddling through -- Monetary policy and fiscal decentralization: Some conclusions -- Institutional Setting for Fiscal Policy -- Fiscal federalism as a bane of fiscal prudence -- Fiscal federalism as a boon to fiscal prudence -- Fiscal policy coordination in mature federations -- The impact of fiscal decentralization on fiscal management: Econometric evidence -- Fiscal policy coordination in Brazil: From fiscal distress to fiscal discipline-a giant leap forward -- Fiscal management in China: An unmet challenge -- Fiscal policy coordination: Some conclusions -- Fiscal Decentralization and Fiscal Performance: Some Conclusions -- Notes -- References -- 4 Regional Income Disparities and Convergence: Measurement and Policy Impact Evaluation -- Introduction -- Measures of Regional Inequality -- Static Measures of Regional Inequality -- Maximum-to-minimum ratio -- Coefficient of variation -- Relative mean deviation -- Gini index -- Theil index -- Dynamic Concepts of Regional Inequality -- Regional Disparities: A Cross-Country Snapshot -- Industrial Countries -- Nonindustrial Countries -- Federal versus Unitary Countries -- Regional Income Disparities and Convergence -- Regional Disparity Trends in Federal Countries -- Regional Disparity Trends in Unitary Countries.

Regional Inequalities and Convergence: A Scorecard on National Policies for Regional Development -- Annex 4A: Regional Disparity Trends: Federal Countries: Industrial -- Federal Countires: Industrial -- Federal Countries: Developing -- Unitary Countries -- Annex 4B: Data Sources -- Notes -- References -- 5 Harmonizing Taxation of Interstate Trade under a Subnational VAT: Lessons from International Experience -- Introduction -- Brazil -- Federal VAT -- State VAT -- Harmonization of Interregional Transactions -- Canada -- Federal Level -- Provincial Level -- European Union -- Clearinghouse Mechanism -- Deferred Payment System -- The Little Boat Model -- India -- Central VAT -- Service Tax -- State VAT -- Developments before introduction of state VAT -- Introduction of state-level VAT -- Harmonization of Interstate Tax -- Phasing Out of CST -- The Recommended Options -- Conclusion -- Notes -- References -- 6 Subnational Borrowing, Insolvency, and Regulation -- Introduction -- Benefits and Risks of Subnational Borrowing -- Rationales for Regulating Subnational Borrowing -- Frameworks for Subnational Borrowing: Ex ante Regulation -- Regulatory Frameworks for Subnational Borrowing: Insolvency Mechanisms -- Conclusions -- Notes -- References -- PART 2 Local Finance -- 7 A Local Perspective on Fiscal Federalism: Practices, Experiences, and Lessons from Industrial Countries -- Introduction -- Expenditure Responsibilities of Local Government -- Expenditures by Function -- Expenditures by Level of Government -- Social Programs and Local Government Finance -- Local Expenditures by Function as a Percentage of GDP -- Regulation: Completing the Concept of Core Services -- Capital Expenditures -- Local Government Revenue -- Local Government Taxes -- Property taxes -- Local income taxes -- Local sales taxes -- Business taxes -- Nontax Revenues.

Intergovernmental Transfers -- The purposes and types of grants -- Illustrations of unconditional and conditional transfers -- Unconditional Transfers -- Conditional Transfers -- Summary, Conclusions, and Lessons -- Notes -- References -- 8 Decentralized Governance in Developing and Transition Countries: A Comparative Review -- Introduction -- The Building Blocks of Citizen-Centered Governance in Decentralized Systems -- Accountability -- Electoral incentives -- Checks and balances -- Community participation -- Fiscal Responsibility -- Intergovernmental fiscal system -- Administrative system -- Result-oriented management -- A Simple Scorecard to Measure Decentralized Citizen-Centered Governance -- Accountability Scores -- Fiscal Responsibility Scores -- Conclusion -- Annex: Country Sample -- Note -- References -- Index -- Back Cover.