Agricultural and rural development public expenditure choices and management in the transition economies : lessons from EU practice and experience

Most transition economies face several challenges in the management of scarce public resources. These challenges fall into three broad categories. First, once an overall allocation of resources for public expenditure (including tax expenditures) has been determined for a given function, a strategic and workable mechanism needs to be devised for determining how this allocation can be spent most efficiently. Second, workable procedures need to be laid down for ensuring that the monies that have been allocated to the various activities are in fact generating their intended outcomes. Third, in many large transition economies in particular, the relationships between the center and the regions are not very coherent in terms of budgetary planning and execution. This paper discusses approaches to the determination and management of public expenditure choices in respect of the agricultural and rural development sectors of the transition economies of Eastern Europe. In particular, the paper attempts to draw lessons from practices in the European Union (EU) that might be helpful for these economies.