Ebook: Finance and Governance of Capital Cities in Federal Systems

Capital cities are unique because they are the seat of the national government as well as the host for national institutions - legislative buildings, museums, arts centres - for which the federal government is responsible. They take on political, administrative, and cultural/symbolic roles that are different from those of other cities. At the same time, they are cities in which people live, use local services, and engage in local political activity. Although many of the political, cultural, and symbolic functions of capital cities in federal countries are similar, there is considerable variation in many of the other characteristics of these cities. In terms of finance and governance, national capitals differ with respect to the local governing structure; their roles, responsibilities, and revenues; and their fiscal relationship with the federal government. These distinguishing features reflect differences in national cultures, historical development, constitutions, political structures, and ideologies.