“The Role of Intergovernmental Revenue Bargaining in the (Re-) Production of Territorial Inequalities: The Bolivian Case”
Supervisor: Prof. Dr. Marianne Braig (FU Berlin)
In the context of a continued global commodity boom, the nationalization of the Bolivian hydrocarbon sector in 2006 has generated an enormous increase in state revenues. Nonetheless, the poverty rate has improved rather slightly while inequality indicators remain almost unaltered. Particularly remarkable in this regard are the differences among the subnational units. While all of them are heavily dependent on resource-based transfers from the central state, some regions display better social indicators than others. To what extent can the differences in intra- and interregional inequality be attributed to the fiscal distribution of hydrocarbon revenues?
This project is concerned with the distribution features that arise from the political economy of fiscal federalism in Bolivia. Focusing on the hydrocarbon revenue distribution, my dissertation project aims at exploring the formal and informal polity and policy conditioners that frame the fiscal federalism context of social policy provisions at different levels of government. Within this scope, it focuses particularly on the intergovernmental fiscal bargaining processes and its respective role in the production and compensation of territorial inequalities. I argue that a central burden for an equalizing revenue distribution derives from the persistent political disputes between the national government and the regional elites concerning the territorial organization of the state. These contentions permeate into the dynamics in the arenas of political bargaining and the resulting political settlements. In the case of the hydrocarbon revenue sharing, the political economy of the territorial revenue allocation is generating notable vertical and horizontal fiscal inequalities among the subnational units. These territorial fiscal imbalances in turn are very likely to bias the subnational governments’ capacity to decrease per capita inequalities by conditioning the financial amounts for social policy provisions.
This dissertation project incorporates the public policy literature that considers the entanglement between endogenous factors of state organization and the implementation of social policy provisions at different levels of government. While a majority of the explanations focus on institutional factors, I highlight the synergy of endogenous factors (institutional and political conditioners) as well as exogenous factors (global conditioners) that shape the intergovernmental fiscal bargaining - the financial base of social policy provision. Using a mixed methods research design, my analytical framework seeks to enable an integrated study of the revenue sharing features on the one hand and the entangled patterns of subnational public policy provisions on the other in order to decode the nexus between intergovernmental fiscal bargaining and the reproduction of inequalities across space in Bolivia.