The Korea Local Administration Review

This study examines the feasibility of introducing the self-control ratio of local finance, which will depict the presence of transfer revenues.
The new index (self-control ratio of local finance) is supposed to express the real size of fiscal capacity available for the local government, which will let the local government decide what to do with what amount from their own initiative. It also expresses the equalizing effect of the local fiscal coordination system to smoothen the imbalance in local fiscal revenues. The correlation analysis shows that the correlation coefficient between the self-control ratio and the self-reliance ratio is high, but gradually goes down.
Before introducing the new index, the renaming or redefining of words related with self-control or self-conduction is needed. Otherwise, there will be some confusion with the names of fiscal indices.