Regional Allocation of Public Funds: An Evaluation Index

When different levels of government coexist in the same country, it is often imperative to implement an ‘objective’ system for transferring funds automatically among them. With the method presented in this paper one may address the question of how the relative need of public services, and therefore the allocation of funds, may be estimated for different communities. It is based on the idea of comparing the access to the public services in every community, through the use of a statistical treatment in which a set of indicators are aggregated into an indicator of need, which is used to allocate funds in order to reach ‘equal access’. The method is then applied to the case of Spain.