보통교부세 배분에 있어서의 조정률경정에 관한 연구

A Study of the Adjustment Factor in the General Grant System of Korea

In the current general grant system operated by the central government, the amount of the general grant for each local government is to be equal to the fiscal shortage, that is, the base fiscal need minus the base revenue. However, the distributable total almost always falls short of the sum of fiscal shortages of grantee governments. Therefore, the amount of fiscal shortage is adjusted by multiplying the common adjustment factor calculated by dividing the total distributable amount by the sum of shortages. This way of adjustment, however, does not take into account the marginal value of grant, and does not bring about the highest attainable level of fiscal equalization. This study proposes an alternative method in which every unit of the grant is distributed to the local government that values the money most highly until the distributable total is exhausted. Under the assumption of decreasing marginal value of money, this process will result in the equal level of fiscal capacity among the grantee governments even though some high-capacity governments that will receive grant under the current system would be excluded from the distribution. As a result, the fiscal equalization comes to be perfect among the grantee governments and the total value of the grant money is maximized. The same result can be obtained if the adjustment factor is calculated as the ratio of the sum of the total base revenue and the distributable total to the total of base fiscal needs. The Seoul metropolitan government currently uses this method.