Fiscal Discipline Assessment Model for Bulgarian Municipalities
Fiscal Discipline Assessment Model for Bulgarian Municipalities

Summary/Abstract: This article examines the fiscal stability of Bulgarian municipalities in conjunction with financial discipline, which is crucial for carrying out the criteria and indicators set up by Bulgarian Public Finance Act (2017). An evaluation model has been developed to assess the propensity of municipalities to observe fiscal discipline, which is a prerequisite for their financial stability. The study covers all municipalities in Bulgaria (265 municipalities in total) irrespective of their population size and economic potential. The evaluation in the model is complex and dependencies are drawn between the financial indicators that characterize the municipalities’ financial state and the fiscal disciplinе. The findings and the results of the model contribute to the existing literature on local public finance by empirically developing indices for assessment of the dependency of fiscal stability and fiscal discipline.

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