The current transfer mechanism

The transfer mechanism which was meant to counteract regional imbalances has had a special place in the federal policy of regional equalization. However, since its appearance and actually up to now it has been under severe criticism, and its ten-year jubilee is a good time to concentrate all attention on its unsolved problems. The paper is intended to elucidate, by use of a broad set of empirical data for the last four years, the causes for discontent expressed mainly by region-donors and to formulate the consequences of the federal policy of budgetary equalization on the territory of the Siberian Federal District.