Federalism, Fiscal Authority, and Centralization in Latin America

This book studies the process of fiscal centralization in the Latin American federations.

Alberto Diaz-Cayeros (Author)

9780521861632, Cambridge University Press

Hardback, published 21 August 2006

302 pages
24 x 16 x 2.4 cm, 0.543 kg

'Because studies on fiscal policy remain largely detached from the politics of taxation, a major strength of the works reviewed here is that they take into account the viability of proposed policy changes. Federalism, Fiscal Authority, and Centralization in Latin America, by Díaz-Cayeros, represents the best of this emergent literature. … Overall this book is a must-read for students of political economy and those interested in the politics of fiscal policy reform in Latin America.' Latin American Research Review

This book explores the politics of fiscal authority, focusing on the centralization of taxation in Latin America during the twentieth century. The book studies this issue in great detail for the case of Mexico. The political (and fiscal) fragmentation associated with civil war at the beginning of the century was eventually transformed into a highly centralized regime. The analysis shows that fiscal centralization can best be studied as the consequence of a bargain struck between self-interested regional and national politicians. Fiscal centralization was more extreme in Mexico than in most other places in the world, but the challenges and problems tackled by Mexican politicians were not unique. The book thus analyzes fiscal centralization and the origins of intergovernmental financial transfers in the other Latin American federal regimes, Argentina, Brazil, and Venezuela. The analysis sheds light on the factors that explain the consolidation of tax authority in developing countries.

1. Federalism, party hegemony and the centralization of fiscal authority
Part I. Fiscal Centralization in Mexico: 2. Regional fragmentation and failed commitment
3. The official party as a regional compromise
4. Nominations, veto players and gubernatorial stability
5. Transfers and redistribution in the Mexican States
Part II. Centralization and Revenue-sharing in the Latin American Federations: 6. Venezuela: unitarianism in disguise
7. Argentina: regime change and fragile credibility
8. Brazil: the retention of fiscal authority
9. State building, political institutions, and fiscal authority.

Subject Areas: Political economy [KCP], Comparative politics [JPB]