Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/83871
Authors: 
Singh, Nirvikar
Year of Publication: 
2005
Series/Report no.: 
Working Papers, UC Santa Cruz Economics Department 613
Abstract: 
This paper provides a self-contained overview of the present problems of state finances in India. It begins with an overview of historical evolution and current institutional structures, including economic, political, administrative and fiscal aspects of India's federal system. The paper then reviews the current situation of India's state government finances, going on to consider various developments that have shaped the states' current fiscal situation, including the roles of national economic reform, the intergovernmental transfer system, tax reform, and local government reform. Policy options for reforming institutions of fiscal federalism system, borrowing mechanisms for the states, and governance are then discussed, with an emphasis on the principle that states should have appropriate incentives for fiscal discipline at the margins of revenue and expenditure.
Subjects: 
fiscal policy
intergovernmental transfers
incentives
institutional reform
JEL: 
H1
H7
P2
Document Type: 
Working Paper

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