Evolution of debt limitations of local governments in Poland since 1990

Pawel Galinski

Abstract


Purpose. The main purpose of the paper is to characterize the evolution of debt limitations in local government in Poland in order to indicate their influence on the financial situation both the public finance sector and the each local governmental unit.

Methodology. Firstly, the analysis of the literature and practice in the field of the debt limitations of the local sector in the European countries in order to define the types of these conditions. Secondly, the review of the legal conditions of incurring debt by local governments in Poland that existed from 1990 against the background of the financial condition of the public sector. Moreover, author is going to present the size of the debt in local governments and their significance there.

Results. The author wants to present the interactions between the debt limitations of the local governments and other aspects of the economy and the public sector. Furthermore, the paper will show that some solutions in this field may distort the financial picture of the units and cause threats for their financial safety.

The theoretical contribution. Paper outlines the approaches in the debt limitations in the local sector.

Practical implications (if applicable). It might be helpful for policymaker to implement debt limitations for local governments and potential threats of some policies in this field. That’s why it may also assist to adjust these debt limitations to the situation of the economy and the public finance.

Keywords: debt, limits, local government

Paper type: Research paper.

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