A Critical Analysis of The Practice of Fiscal Federalism In Ethiopia: The Case of Oromia and Afar Regional States (1991–2015)
| dc.contributor.advisor | Tegegne Teka (PhD) | |
| dc.contributor.author | Samson Mesfin | |
| dc.date.accessioned | 2024-02-09T14:01:48Z | |
| dc.date.available | 2024-02-09T14:01:48Z | |
| dc.date.issued | 2023-06-10 | |
| dc.description.abstract | The main objective of this dissertation was to assess the practices of fiscal federalism in Ethiopia (1995- 2015) with reference to Federal-Regional interface and Woredas (districts) context by selecting two Regional States; namely Oromia (representing the relatively 'developed regions') and Afar (representing the 'emerging regions'). The study employed more of qualitative research approach to achieve the objective mentioned above. Both Primary and secondary data sources were used in gathering relevant data for the study. The techniques that have been used for gathering primary data are in-depth interview and discussion with key-informants at all levels of governments focusing on group discussion with local communities and field observation. Secondary data were gathered from published and unpublished materials available in various forms including books, journal articles and official annual reports of government institutions at federal, regional and local levels. The study also reviewed the experiences of some federal countries around the world on the issue of fiscal federalism with the aim of obtaining best practices and use as input in modifying the decentralized fiscal system of Ethiopia. To analyze the date gathered through above means, the study employed both qualitative and quantitative methods of data analysis. The findings of the study indicated that the Constitutional assignment of expenditure responsibility in Ethiopia is more or less in compliance with the theoretical literature of fiscal federalism while the assignment of taxation power does not agree with the theoretical and empirical literatures of fiscal federalism. The practice, however, shows lack of clarity on the assignment of power and fiscal responsibilities, particularly on shared responsibilities. As the result, it creates duplication and overlapping responsibility problems and may lead to conflict between federal and regional governments as well as regional and local governments. The findings also show that the devolution of expenditure responsibilities to the sub-national governments (SNGs) is not accompanied by adequate financial resources, resulting in high vertical and horizontal fiscal imbalances in Ethiopia. As the result, SNGs in Ethiopia rely heavily on federal transfers to cover the costs of the functions that devolved to them by laws. This, in turn, limits the fiscal autonomy of authorities at sub-national levels, which adversely affected the efficiency of public service delivery and accountability at the grass root levels. Overall, the study found out that there are several problems and challenges faced while implementing fiscal decentralization at sub-national levels in Ethiopia. It includes lack of clarity in the assignment of power and fiscal responsibilities, particularly on shared responsibilities; lack of fiscal autonomy due to insufficient own revenues; weak administration and institutional capacity. This happened because of lack of trained and experienced human resources; poor political willingness and commitment of authorities at higher level to devolve taxing and spending powers in real sense; as well as lack of a stable, predictable and transparent intergovernmental fiscal transfer system. Thus, the research recommends that the federal government should give more emphasis to enhance the fiscal autonomy of sub-national governments so as to realize the potential benefits of effective fiscal federalism in Ethiopia | |
| dc.identifier.uri | https://etd.aau.edu.et/handle/123456789/1754 | |
| dc.language.iso | en_US | |
| dc.publisher | AAU | |
| dc.title | A Critical Analysis of The Practice of Fiscal Federalism In Ethiopia: The Case of Oromia and Afar Regional States (1991–2015) | |
| dc.type | Thesis |