Budgetary Solvency Factors in Brazilian Municipalities
DOI:
https://doi.org/10.14392/asaa.2025180110Keywords:
Budgetary Solvency, Financial Autonomy, Current Balance, Indebtedness, InvestmentAbstract
Objective: This study aims to analyze the relationship between budgetary solvency and the determining factors of financial autonomy, current balance, indebtedness, and public investment in medium and large Brazilian municipalities. The analysis seeks to understand the impact of these variables on the financial condition of municipal entities, contributing to the improvement of public management financial planning, and decision-making in public administration.
Method: The research uses data from 409 Brazilian municipalities with a population of over 50,000 inhabitants, covering the period from 2016 to 2021. To estimate the models, linear regression was applied using the Arellano-Bover, 1995, system estimator with robust correction.
Results: The findings indicate that the budgetary solvency of medium and large municipalities is negatively impacted by levels of indebtedness and investment. However, no statistically significant relationship was identified between budgetary solvency and the variables financial autonomy and current balance. These results support the formulation of fiscal policies and municipal financial planning.
Contributions: The study contributes by presenting a mapping of the budgetary solvency of Brazilian municipalities, providing support for public managers in the execution of sustainable fiscal policies. Additionally, it offers support for control bodies in assessing fiscal management and promotes academic debate on the importance of budgetary solvency in municipal administration.
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