Political Economy of Intergovernmental Transfers in the Context of a Post-Communist Economy

Intergovernmental transfer schemes are designed to promote social welfare and balanced territorial development, but political and electoral considerations may also shape their allocation. This study examines intergovernmental transfers in relation to election cycles and mayoral political affiliation in Albania, a post-communist economy. Covering periods before and after the 2015 decentralization reform, the analysis distinguishes between unconditional and conditional transfers and combines primary and secondary data using quantitative and qualitative methods. The findings reveal stronger political influence in conditional transfers, with municipalities aligned with the central government receiving more conditional grants.