The Political Implications of Indebtedness of Small Municipalities in the Czech Republic : Case Study of Karlovy Vary Region 2010-2014
Abstract
The aim of this book is to outline the impact of critical indebtedness of small municipalities in the Czech Republic. The author points out the possible causes and conditions that can lead to the failure of small municipalities as a consequence of indebtedness.
The research is based on the empirical study of three critically indebted municipalities in the Karlovy Vary region (Bublava, Nebanice and Prameny) and on data obtained through interviews with mayors from the Karlovy Vary region. Because of their limited financial possibilities, small municipalities often rely on other than municipal resources in order to finance local development, thus making small municipalities especially vulnerable to indebtedness.
As a result of expensive and erroneous investments, small municipalities can acquire immense debt, but are unable to repay later and the municipality can face distraint. Critical indebtedness negatively impacts not only the services provided to residents and but local democracy also.