engleski

Fiscal performance of local government units for smart regions and smart cities

The complexity of the public administration system in Croatia is the result of current legislation and the different political goals of certain political parties. The final result is an uncompleted process of political, functional and fiscal decentralization. The consequence of that is slow local economic development of local government units in Croatia. Nowadays, the main characteristics of the administrative and territorial structure of Croatia are a centralized management system, low level of fiscal decentralization as well as the low fiscal capacity of local and regional government units. The objective of this paper is to analyze the fiscal performance of local government units in Croatia over the 2010-2018 period for the establishment of smart regions. The results of the analysis have shown that the fiscal capacity of cities is higher than in municipalities in the observed period, allowing them to finance expenditures for local development. Therefore, this provides evidence for fiscal performance and fiscal capacity for the establishment of smart regions and cities.

local development, fiscal decentralization, fiscal capacity, smart region

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