Municipal Fiscal Management: an analysis from the perspective of fiscal federalism and political cycles in local governments

Research Objective: Analyze the factors that influence municipal fiscal management from the perspective of the theory of fiscal federalism and the theory of political cycles in local governments. Theoretical Framework: This study addresses municipal fiscal management, fiscal federalism and political cycles. Methodology: We used regression models for panel data, in the local governments represented by Parana municipalities, in the period from 2013 to 2019. Results: The variables representing the collection autonomy positively influence the indexes of net consolidated debt and personnel expenses. It was also identified that the financial condition helps to explain the indicators of fiscal management. Finally, based on political cycles, there is a tendency towards opportunistic behavior in electoral periods since both indicators tend to be higher during periods of local elections. Originality: Exploring municipal fiscal management, related to the political, fiscal and federative particularities of subnational governments, in the state of Parana scenario, whose characteristics of collection and distribution of taxes, allows the use of different variables. Theoretical and practical contributions: The research presents theoretical and practical contributions by portraying the factors that impact fiscal management in local governments, under the lens of theoretical approaches to fiscal federalism and political cycles, demonstrating the elements that can affect the balance of public accounts.