Central and Sub-national Government Relations: Measuring a Central Government’s Contingent Liability Risk

The current economic climate and the fiscal constraints that many central governments are facing has put sub-national governments’ solvency under the spotlight. The purpose of this project was to create an index that assesses the contingent liability risk posed to a central government by its sub-national governments’ debt and spending. The final index has been applied to five countries with diverse federal systems: Argentina, Germany, Mexico, Spain, and the United States.