The methodological issues for case studies that are examined here are designed to make that judgment easier. The proposed case study approach focuses on the process of decentralization. During the process of decentralization we expect the simultaneous occurrence of economic concerns, such as giving local government tax and borrowing power and guaranteeing macroeconomic stability at the national level. The simultaneously occurring phenomena have both positive and negative aspects. Therefore, our methodological approach focuses on the application of appropriate fiscal rules and appropriate fiscal mechanisms for achieving the potential benefits of fiscal decentralization, while minimizing the likelihood of negative consequences.
Normative rules are more general than mechanisms.
Rules specify general principles by which fiscal affairs should be organized. Mechanisms are specific steps, tools, or institutional arrangements that can be brought to bear to implement rules. Not all rules have predetermined mechanisms to apply. In performing the case studies, observations should be made on how well the case has applied the rules and used the mechanisms suggested in the text. From this, one can identify probable reasons why a case has been particularly successful or why it has failed.