Contrasts in Budgetary Opportunities of City-Regions and City-Municipalities in Russia and the Experience of Germany


This paper compares the experience of Russia and Germany in terms of the differentiation of cities of various status in the territorial system according to their powers and fiscal revenues. We analyze the data on the number and population sizes of urban districts (okrugs) in Russia and their analogues in Germany, as well as the data on the execution of budgets of city-municipalities and city-regions. It is shown that the system of territorial division in Russia at the municipal level differs from the German one by significantly greater fragmentation and the dominance of urban districts with a small population. In both countries, local budgets are aimed at solving social problems and developing local infrastructure, and their approaches to secure tax sources for local budgets are also similar. At the same time, the contrast between the fiscal indicators (revenues and expenditure per capita, the share of interbudgetary transfers in revenues) of city-regions and city-municipalities in Russia is much greater than in Germany, which limits the ability of the authorities in urban districts to pursue an independent economic policy, including support for the development of foreign economic relations. We suggest the directions for the growth of the revenue base of local budgets in Russia (the complete transfer of tax payments from small businesses to local budgets, improving the quality of accounting for land and real estate, and management of nontax revenues) and endowing different powers to local governments of urban districts with different population sizes.

This is a preview of subscription content, access via your institution.


  1. 1.

    Spatial Development Strategy of the Russian Federation for the Period until 2025. Approved by Order of the Government of the Russian Federation no. 207-r of February 13, 2019. Accessed February 28, 2020.

  2. 2.

    Federal cities may include intracity municipalities, but in practice the latter do not play an important role. In this paper, we do not consider urban settlements (municipalities) that are formed from cities with a smaller population size (than urban districts) and therefore they are not of interest for our study because, due to their small size, they cannot claim the status of global cities.

  3. 3.

    Daten aus dem Gemeindeverzeichnis Kreisfreie Städte und Landkreise nach Fläche, Bevölkerung und Bevölkerungsdichte. Accessed February 28, 2020; Finanzen und Steuern. Rechnungsergebnisse der Kernhaushalte der Gemeinden und Gemeindeverbände (2019). Accessed February 28, 2020; Finanzen und Steuern. Vierteljährliche Kassenergebnisse des öffentlichen Gesamthaushalts (2018). Accessed February 28, 2020.

  4. 4.

    Population of the Russian Federation by Municipalities as of January 1, 2019. Statistical Bulletin of Rosstat. Accessed August 8, 2019.

  5. 5.

    Consolidated Budgets of Federal Subjects and Budgets of Territorial State Extra-Budgetary Funds. Federal Treasury. Accessed February 17, 2020.

  6. 6.

    Amendments by Federal Law no. 87-FZ of May 1, 2019 to Federal Law no. 131-FZ of October 6, 2003 On the General Principles of Organization of Local Self-Government in the Russian Federation. Accessed February 28, 2020.

  7. 7.

    Germany’s situation in terms of the level of socioeconomic development of the capital city is not typical for countries worldwide; in the system of interbudgetary relations, Berlin is one of the regions-recipients. The level of economic development of the former East Berlin, like all the eastern regions after the unification of Germany, turned out to be below the level of development of the western regions. The former West Berlin faced economic difficulties, because after the unification of Germany its entrepreneurs lost the support they had been previously receiving as compensation for the exclave position of West Berlin.


  1. 1

    Avdon’kin, V.Ya., The foreign economic activity of a municipality, Vestn. Chelyab. Gos. Univ., 2008, no. 27, pp. 74–81.

  2. 2

    Bazhenov, Yu.N., Podshuveit, O.V., and Chernykh, A.N., Management of foreign economic activity of St. Petersburg: program and institutional approach, Ekon. Upr., 2015, no. 5, pp. 34–39.

  3. 3

    Bogatstvo i samostoyatel’nost’: chto delaet byudzhet goroda ustoichivym. Byudzhety regional’nykh stolits 2013–2015 gg. (Wealth and Independence: What Makes City’s Budget Sustainable. Regional Budgets of Capitals in 2013–2015), Moscow: KB Strelka, 2017.

  4. 4

    Boikova, M.V., Ilina, I.N., and Salazkin, M.G., The future of cities: cities as agents of globalization and innovation, Forsait, 2011, vol. 5, no. 4, pp. 32–48.

    Google Scholar 

  5. 5

    Bukhval’d, E.M., European Charter of Local Self-Government and foreign experience in municipal reform of Russia, Vestn. Inst. Ekon., Ross. Akad. Nauk, 2014, no. 2, pp. 97–109.

  6. 6

    Gusev, A., Million-plus cities among federal cities: budget effects, Kapital Strany, 2017, Jan. 18. statuse_gorodov_federalnogo_znacheniya_budjetnye_effekt. Accessed February 20, 2020.

  7. 7

    Ziyadullaev, N.S., Rozhdestvenskaya, I.A., and Rostanets, V.G., International economic relations of Moscow in the post-crisis period, Ross. Vneshneekon. Vestn., 2012, no. 4, pp. 19–29.

  8. 8

    Karavaeva, I.V., Approaches to the formation of the tax base of local self-government in Russia, Federalizm, 2011, no. 1, pp. 143–152.

  9. 9

    Krivonosova, N.Ya., Organization of local self-government and the state of local budgets in Germany and Russia: a comparative analysis, Izv. Baikal. Gos. Univ., 2018, vol. 28, no. 2, pp. 208–222.

    Article  Google Scholar 

  10. 10

    Kuznetsova, O.V., Budgetary capacities of million-plus cities in Russia as a factor of their socioeconomic development, Vestn. Mosk. Univ., Ser. 5: Geogr., 2018, no. 4, pp. 75–82.

  11. 11

    Kuznetsova, O.V., Inter-budgetary relations: comparison between Russia and Germany, Kazan. Federalist, 2006, no. 3, pp. 56–67.

  12. 12

    Kurt, R. and Frank, V., Development of municipal self-government system in Germany, Probl. Teor. Prakt. Upr., 2017, no. 10, pp. 8–18.

  13. 13

    Lebedeva, M.M., Change of the role of cities and intrastate regions in world politics, Oikumena, 2019, no. 1, pp. 7–16.

  14. 14

    Liborakina, M.I., Foreign experience in organization of local self-government, Politiya, 2003, no. 4, pp. 225–237.

  15. 15

    Mishina, E.I., Kondrat’eva, M.I., and Krasil’nikova, N.A., The activities of the Committee for Foreign Economic and Interregional Relations of the Administration of the city of Nizhny Novgorod, Materialy III Vserossiiskoi nauchno-prakticheskoi konferentsii “Aktual’nye problemy upravleniya” (Proc. III All-Russ. Sci.-Pract. Conf. “Current Problems of Governance”), Nizhny Novgorod, 2016, pp. 16–25.

  16. 16

    Povarova, A.I., Stagnation of self-sufficiency of the budgets of urban districts, Ekon. Sots. Peremeny: Fakty, Tendentsii, Prognoz, 2016, no. 1, pp. 108–121.

  17. 17

    Savkin, D.A., The role of global cities in the world politics, Vestn. S.-Peterb. Univ., Ser. 6: Filos., Kul’turol., Politol., Pravo, Mezhdunar. Otnosheniya, 2009, no. 4, pp. 176–184.

  18. 18

    Semkina, O.S. and Murar, V.I., Development of foreign economic relations of the Ulan-Ude city, Vestn. Ross. Univ. Druzhby Narodov, Ser. Gos. Munits. Upr., 2015, no. 1, pp. 21–28.

  19. 19

    Sumskaya, T.V., Formation of financial basis of local self-governance in Russian Federation, Reg.: Ekon. Sotsiol., 2019, no. 1, pp. 225–249.

  20. 20

    Zimmermann, H., Kommunalfinanzen, Baden-Baden: Nomos Verlagsgesellschaft, 1999.

    Google Scholar 

Download references


This study was supported by the Russian Foundation for Basic Research, project no. 18-014-00044 A “The Role of Global Cities in the Transformation of State Regulation of Territorial Development (Experience of OECD Countries).”

Author information



Corresponding author

Correspondence to O. V. Kuznetsova.

Ethics declarations

The author declares that she has no conflict of interest.

Additional information

Translated by K. Lazarev

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Kuznetsova, O.V. Contrasts in Budgetary Opportunities of City-Regions and City-Municipalities in Russia and the Experience of Germany. Reg. Res. Russ. 10, 522–529 (2020).

Download citation


  • Russia
  • Germany
  • federal subjects
  • municipalities
  • urban districts
  • local budgets
  • taxes
  • nontax revenues
  • interbudgetary transfers
  • globalization
  • foreign economic policy