Nicola Limodio discussion of: Natural resource revenues and municipal finance

National and local authorities often face the challenge of effectively utilizing exogenous revenues such as grants and natural resource rents. These funds, while independent of their decision-making processes, offer an opportunity to improve public sector services or facilitate private consumption through tax reductions. While some local governments may channel these resources towards infrastructure development or public services, others may opt to reduce local taxes and debts, thereby easing the financial burden on citizens.