Local Fiscal Disparity: Case Study of Thailand’s Provincial Administrative Organization

Main Article Content

Pichit Ratchatapibhunphob
Direk Pattamasiriwat


     This paper is a case study of local government finance in Thailand with primary focus on Provincial Administrative Organizations (PAOs). The Gini coefficients for PAOs’ per capita revenue are estimated, compared, and discussed. We hypothesize that revenue disparity led to inequalities in budget expenditures, local initiatives, and the chances of getting a “good local governance award”. Our empirical investigation is summarized as
follows. First, the Gini coefficients for own-collected revenue for FY2011 was 0.4, compared to 0.28 for shared taxes, and 0.23 for grant revenue—these confirmed the existence of fiscal disparity. Second, grant allocations failed to perform an equalization objective as those PAOs that collect more of their own revenue and shared taxes also tend to receive higher amounts of grant revenue per capita. Third, PAOs with high
revenue per capita had better chances of receiving a “good local governance award”. Fourth, there is a strong positive correlation between revenue and expenditure, i.e., a 100 percent increase in revenue led to a 95 percent increase in expenditure. Fifth, regarding the percentage of budget allocation for investment and wage compensation, there was not much difference between the high-income PAOs and the low-income PAOs, which is contrary to common expectation. However, the percentage of budget allocation for subsidy was significantly higher in the high-income PAOs than in the low-income PAOs.


Download data is not yet available.

Article Details

How to Cite
ratchatapibhunphob, pichit ., & pattamasiriwat, direk . (2020). Local Fiscal Disparity: Case Study of Thailand’s Provincial Administrative Organization. King Prajadhipok’s Institute Journal, 12(2), 52–76. Retrieved from https://so06.tci-thaijo.org/index.php/kpi_journal/article/view/244308
Original Articles


จรัส สุวรรณมาลา. ๒๕๕๓. ประชาธิปไตยทางการคลังไทย. พิมพ์ครั้งที่ ๑. กรุงเทพฯ: โรงพิมพ์แห่งจุฬาลงกรณ์มหาวิทยาลัย.

ดิเรก ปัทมสิริวัฒน์และคณะ. ๒๕๕๒. รายงานวิจัย การประเมินกองทุนสุขภาพตำบล สนับสนุนโดย สถาบันวิจัยระบบประกันสุขภาพถ้วนหน้า. กรุงเทพฯ: พี.อี.ลีฟวิ่ง.

ดิเรก ปัทมสิริวัฒน์. ๒๕๕๓. การคลังท้องถิ่น: รวมบทความวิจัยเพื่อเพิ่มพลังให้ท้องถิ่น. พิมพ์ครั้งที่ ๒. กรุงเทพฯ: พี.อี.ลีฟวิ่ง.

ดิเรก ปัทมสิริวัฒน์ และพิชิตรัชตพิบุลภพ. ๒๕๕๖. การคลังท้องถิ่นและการจัดสรรงบประมาณของสำนักงานเขตกรุงเทพมหานคร. วารสารรัฐประศาสนศาสตร์ สถาบันบัณฑิตพัฒนบริหารศาสตร์. ๑๑ (๑):๑๑๑-๑๓๕.

วีระศักดิ์ เครือเทพ. ๒๕๕๖. ถอดรหัสการจัดเก็บภาษีอากรของท้องถิ่นไทย. พิมพ์ครั้งที่ ๑. กรุงเทพฯ: โรงพิมพ์แห่งจุฬาลงกรณ์มหาวิทยาลัย.

Boadway, Robin. 2007. Compensating Local Government for Differences in Expenditure Needs in aHorizontal Fiscal Equalization Program. In Handbook of Intergovernmental FiscalTransfers: Principles and Practice. AndrewReschovkey (ed.). Washington, D.C.: The World Bank.

Boadway, Robin and Anwar Shah. 2009. Fiscal Federalism, Principles and Practice of Multiorder Governance. Cambridge: Cambridge University Press.

Charles M. Tiebout 1956. A Pure Theory of Local Expenditures. The Journal of Political Economy. 64 (5): 416-424.

DirekPatmasiriwat. 2012. Fiscal Inequality and Grant Allocation: Provincial Analysis of Thailand’s Local Government Finance. In Handbook of Local Governments in a Global Context.

Peerasit Kamnuansilpa and Bonnie Pacala Brereton (eds.). College of Local Administration, KhonKaen University: 91-115.

Eckardt, Sebastian and Anwar Shah. 2006. “Indonesia,” in Local Governance in Developing Countries. (eds.). by Anwar Shah, Washington, D.C.: World Bank.

Jameson Boex and Jorge Martinez-Vazquez. 2004. Designing Intergovernmental Equalization Transfers with Imperfect Data: Concepts, Practices, and Lessons. In Handbook of Fiscal Equalization: Challenges in the Design of Intergovernmental Transers. Jorge Martinez-Vazquez and Bob Searle eds. Springer Science+Business Media, Inc.: New York.

Lerman, R. I., and S. Yitzhaki. 1985. Income Inequality Effects by Income Source:A New Approach and Applications to the United States. Review of Economics and Statistics. 67: 151-156.

Roy Bahl. 2000. Intergovernmental Transfers in Developing and Transition Countries: Principles and Practice. World Bank.

Shah, Anwar 2006. The new vision of local governance and the evolving roles of local governments,” in Local Governance in Developing Countries (ed.). Anwar Shah, Washington, D.C.: World Bank.

Wallace oates 1972. Fiscal Federalism. Harcourt Brace Jovanovich: New York.