INTERGOVERNMENTAL RELATIONS AND PUBLIC ADMINISTRATION: OPPORTUNITIES AND LIMITATIONS OF DECENTRALIZATION

In recent decades, one of the most important trends in public administration reforms has been fiscal decentralization. At the heart of this process is the principle of subsidiarity, according to which local governments must fulfill their own set of functions and make their own budget decisions at the expense of local tax revenues. The importance of fiscal decentralization is noted in international documents, such as the Maastricht Treaty and the European Charter of Local Self-Government. This paper provides an overview of research related to existing academic knowledge in the area of fiscal decentralisation and intergovernmental fiscal relations. The main attention is paid to the opportunities and limitations of decentralisation, the existing empirical estimates of its impact, the latest theoretical concepts of intergovernmental relations and the key principles of regulations.