An autonomous research institute under the Ministry of Finance


Fourteenth Finance Commission Impact of Its Recommendations

Publication date

Mar, 2018


Economic and Political Weekly, 53(10), Mar 10, 2018.


Mita Choudhury, Ranjan Kumar Mohanty and Jay Dev Dubey


Preliminary evidence on the impact of the recommendations of the Fourteenth Finance Commission suggests that there has been an increase in central transfers and social sector expenditures in a number of states in 2015–16. This evidence is biased upwards due to two factors. First, much of the gains have been measured with respect to a low base year. Second, the inferences are affected by systematic differences between actuals, revised estimates, and budget estimates. Using a modified base and comparable estimates for 15 major states, it is seen that these are much smaller. Besides, in most states, social services have received a lower priority over economic services in 2015–16.

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