Academic journal article Asian Social Science

Methodological Approaches towards Assessing the Efficacy of a Region's Budgetary/Taxation Policy

Academic journal article Asian Social Science

Methodological Approaches towards Assessing the Efficacy of a Region's Budgetary/Taxation Policy

Article excerpt

Abstract

This article provides an analysis of existing methodologies for assessing the efficacy of a region's budgetary/taxation policy and identifies their strengths and weaknesses. The author argues in favor of that the efficacy of a region's entire budgetary/taxation policy can be assessed by the efficiency of the activity of the executive authorities in the above focus areas based on the correlation of goals set and results achieved. An objectively set criterion of the efficacy of a region's budgetary/taxation policy is the minimum degree of chasms between goals set and results achieved. The author proposes quantitatively measured indicators as criteria of the efficacy of budgetary/taxation policy. On the strength of the analysis conducted, the author proposes a way to assess the efficacy of a region's budgetary/taxation policy, which is based on systematizing an aggregate of measures with a breakdown into structural determinants and calculating the integral coefficient, which, compared with existing methodologies, makes it possible to give an integral and structured, in terms of key blocks, assessment of the efficacy of a region's budgetary/taxation policy both over time and through comparison with other regions and increase the validity and accuracy of the assessment for working out practical recommendations. The author chooses as the basis of his calculation of the integral indicator of the efficacy of a region's budgetary/taxation policy the method of distances, which is based on taking account of the proximity of objects under examination to the touchstone object by indicators compared.

Keywords: methodology, efficacy, budgetary/taxation policy, integral coefficient, method of distances

(ProQuest: ... denotes formulae omitted.)

1. Introduction

The objectives of the new stage in the development of budgetary/taxation decentralization and inter-budget relations, which have been set out in the Budget Message of the President of the RF (Aliyev & Suleimanov, 2013 a), the Budget Strategy for the Period through to 2023 (Aliyev & Suleimanov, 2013b), and the Major Focus Areas of Taxation Policy for 2013 and for the Target Period of 2014 and 2015 (Berezdivina), substantiate the need for expanding regions' self-reliance and responsibility for the sustainable growth of the regional economy and the population's living standards. A number of functions of regulating social-economic processes are shifting from the federal to the regional level; there is an augmentation of the role of regions' budgets in ensuring the progressive dynamics of regional economic complexes and the social sphere. In these conditions, priority significance is being assigned to enhancing the state regulation of regional development and as part of it-boosting the efficacy of regions' budgetary/taxation policy (Treisman, 2004, p. 820).

The formation of effective regional budgetary/taxation policy oriented towards stimulating territorial reproductive processes is an overriding objective of any federal state (Oates, 1972, p. 213). In Russia, resolving this objective is especially complicated due to the specificity of the federal configuration and substantial interregional differences in the level of social-economic development, natural/climactic conditions, national, historical, and other characteristics (Suleimanov, 2013, p. 9). With all the significance of transformations being carried out, the state's present-day budgetary/taxation policy does not facilitate remediating imbalances in regions' social-economic development-due, above all, to the fact that it does not stimulate one's interest in the development of one's own financial/rcsourcc potential and expansion of the taxable base. Boosting the efficacy of regions' budgetary/taxation policy remains one of the issues poorly researched, which need further theoretical conceptualizing and call for working out a methodological toolbox for assessing it.

Boosting the efficacy of regions' budgetary/taxation policy remains a crucial priority in the activity of the authorities of the Federation's constituents (Musaeva, 2013, p. …

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