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The reduction in rural marginalization of infrastructure in Africa has been achieved through the wide diffusion of the so-called fiscal deviation. According to New Institutional Economics, the provision of public resourcing at the local level is more economic since it meets the geographic specificity of infrastructure provisions. However, when intergovernmental fiscal transfers are towards rural road provision, it is majorly because of several structural impediments, that the corrected road will not be realized. This systematic review of literature with regards to devolution and infra-structure provision has laid emphasis on going beyond overly simplistic input-output models to explore the multiple filters regulating decentralized public works. The focus here is on institutional capacity as a crucial explanatory factor and the way deficits in technical engineering, equipment maintenance, and procurement governance conspire to undermine the potency of devolved funding. Moreover, the study discusses the moderating effects in the face of instability in the broader economy, illustrating how hyper-inflation and currency depreciation can deplete real infrastructure funds purchasing power and result in the erosion of the contractor attrition as observed. Finally, the review has identified systemic barriers, such as climate vulnerability and ministerial red-tape friction. The synthesis of empirical literature from 2010 to 2024 suggests that fiscal decentralisation without a built institutional capacity and insulated mechanisms against macroeconomic turbulence cannot deliver in the long run.

The purpose of this study is to examine the impact of the financial risks local governments are exposed to within the scope of financial risk management practices. Istanbul Metropolitan Municipality (IMM) was selected for this study because it is the largest local government with the highest budget. In the study, the development of financial risk performance of IMM between the years 2008-2018 was examined in the light of the risks IMM is exposed to. The main results regarding the risks faced by IMM during the period are as follows: Financial data obtained from the financial statements of IMM were used to examine the performance of listed risks& effects they have on the budget of IMM. The results indicate that (i) risk of dependence on shares from the central budget revenue; (ii) IMM was directly dependent on the central budget in terms of revenues, so in this period, the risk of dependency was high in terms of counterparty risk.