What is it about?
The article discusses how federal systems use financial mechanisms to balance regional wealth disparities. Governments redistribute tax revenue to poorer regions to promote fairness, but political interests often influence these systems. The study compares models in Australia, Canada, Germany, and Spain, highlighting different levels of government involvement. It concludes that while equalization is essential, its implementation is often politicized.
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Why is it important?
This article stands out by comparing how different federal systems manage fiscal equalization, revealing how legal structures and political dynamics shape wealth distribution. Its timely analysis highlights growing interregional disparities and rising political tensions. By exposing hidden challenges and offering fresh insights, it helps policymakers and scholars rethink financial fairness in federalism today.
Perspectives
This chapter explores the growing tensions in fiscal federalism, where solidarity and autonomy often clash. Many studies overlook how legal frameworks and political realities shape equalization. By comparing different systems, it highlights the hidden forces driving policy outcomes. The goal is to spark debate, inform reforms, and ensure that fiscal equalization truly supports fairness and stability.
Francisco Javier Romero Caro
Eurac Research
Read the Original
This page is a summary of: Paradigms of Subnational Government Participation in Equalisation Mechanisms: A Comparative and Constitutional Outlook, February 2025, De Gruyter,
DOI: 10.1163/9789004524514_004.
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