The Distributive Effects of Local Government Finances in Colombia: A Review of the Evidence

Local public finances have in the past received more attention in Colombia than has generally been the case in developing countries. ¹ However, most authors have considered the distributive impact of local government activities only in passing 70if at all. ² Two main reasons are likely to explain this neglect: first, the importance of local government in the overall public sector activities and thus the distributive impact of local finances, is generally underestimated. One of the objectives of this paper is to demonstrate that, particularly in urban areas, local government accounts for a significant proportion of public sector responsibilities, and that the potential for redistribution through the local public sector should not be neglected. A second reason for the apparent reluctance to deal with the distributive effects of local finances may rest with methodological reservations. ³