The Economics and Politics of Financial Unsustainability in Local Government

Financial sustainability represents the ability of local governments ‘to meet the needs of the present generation without compromising the ability of future generations to meet their own needs’ (Chapman 2008: 115). It has long been the domain of economists who seek to explain how rational actors should and do manage scarce resources. However, outside of public choice theory, it has received far less attention from political scientists who have important contributions to make by explaining how the political process can give rise to better management of the collective scarce resources under the control of local governments.