In a dynamic market, the city has become a main source of competitiveness, along with financial and economic benefits. Due to the processes of digitalization, a new concept has been developed, namely smart cities. This concept delivers economic and financial potential, not only to cities, but also to urban and local economic development. Therefore, to ensure the establishment of this concept, local government units, i.e., cities, need to have enough financial resources. In addition, the fiscal capacity of their local budgets should be sufficient. The objective of this paper is to evaluate the fiscal capacity of large cities in Croatia over the 2016-2018 period, as well as to present the financial support through funding schemes for the establishment of smart cities. After calculating the level of fiscal capacity of large cities, the analysis revealed interesting results. Only four large cities (Split, Rijeka, Zadar and Pula) achieved positive fiscal capacity in the observed period. This provides evidence of fiscal performance and fiscal capacity for the establishment of smart cities. This concept will enhance the quality of life, stimulate economic growth, sustain local government budgets and create new value for both investors and the local population.
Bajo, A., Primorac, M., Sopek, P., & Vuco, M. (2015). Neto fiskalni položaj županija od 2011. do 2013 [Neto fiscal position of counties from 2011-2013 period]. Newsletter of Institute of Public Finance, No. 94, 1-9. https://doi.org/10.3326/nlh.2015.94
Borsekova, K., Koróny, S., Vanová, A., & Vitálišova, K. (2018). Functionality between the size and indicators of smart cities: A research challenge with policy implications. Cities, 78, 17-26. https://doi.org/10.1016/j.cities.2018.03.010
Bosch, P., Jongeneel, S., Rovers, V., Neumann, H.-M., Airaksinen, M., & Huovila, A. (2017). CITYkeys indicators for smart city projects and smart cities. Report. European Commission.
Chitiga-Mabugu, M., & Monkam, N. (2013). Assessing Fiscal Capacity at the Local Government Level in South Africa. Department of Economics Working Paper Series No. 2013-76. South Africa: University of Pretoria.
Cretu, L.G. (2012). Smart Cities Design using Event-driven Paradigm and Semantic Web. Informatica Economica, 16(4), 57-67.
European Commission. (2013). Financing models for smart cities. Guidance Document. Brussels.
European Investment Bank (EIB). (2018). Smart Cities, Smart Investment in Central, Eastern and South-Eastern Europe. Report of EIB Economics Department, 1-54.
Nam, T., & Pardo, T. A. (2011). Smart City as urban innovation: Focusing on management, policy, and context. Paper presented at 5th international conference on theory and practice of electronic governance (ICEGOV2011), 185-194. https://dl.acm.org/doi/10.1145/2072069.2072100
Stanković, J., Džunić, M., Džunić, Ž., & Marinković, S. (2017). A multi-criteria evaluation of the European citiesʼ smart performance: Economic, social and environmental aspects. Proceedings of Rijeka Faculty of Economics: Journal of Economics and Business, 35(2), 519-550. https://doi.org/10.18045/zbefri.2017.2.519