An analytical perspective for policy studies in intergovernment financial relations in Australia

Abstract

Systems analysis provides a framework for the quantification of financial interrelationships in a multi-level hierarchical system of government. In outlining how the entanglements of intergovernmental financial relations can be quantified, reference is made to the specific impact of Commonwealth funding on State and local government financial behaviour, and to the general impact on resource allocation processes in major sectors of the regional economy. As a first step in the elaboration of a range of policy relevant research studies a behavioural model has been estimated of the fiscal impact of Commonwealth and State government grants on local government financial behaviour.