Introduction

This introduction presents an overview of key concepts discussed in the subsequent chapters of this book. The book explains about Fiscal autonomy which is a basic component of the economic approach to what is normally called fiscal federalism. The variety of practices of fiscal federalism as applied all over the world will emerge from the following pages. Adopting the textbook distinction among the various orders of government, the array of cases presented in the book includes both traditionally unitary countries as well as federal and con-federal ones. Fiscal autonomy of sub-national units makes undoubtedly more complicated the implementation of the so-called fiscal equivalence principle, the coincidence of the administrative area with the benefit area of the public services provided. Yet, it is the variation across the municipal landscape that is the hallmark of the American system of federalism. It reviews the role of municipalities in the US federalism system, their evolution and autonomy and their access to fiscal resources.