First Results, Implications and Incentives in Mexican Federative Entities of the Alert System of the Financial Discipline Law of the Federative Entiti
This paper will evaluate the results observed in and the incentives generated by The System of Alerts of the Financial Discipline Law of the Federative Entities and the Municipalities in the years 2016 to 2018. The working conjecture is that this indebtedness monitoring system has generated incentives to reduce debt levels in Mexican federal entities. The paper will follow the traditional scientific method, including problem formulation, analysis of information sources, data collection, analysis and interpretation of information. Primary data will be used from the Alert System database, following a non-experimental process with a quantitative orientation. To confirm trends, statistical tools such as regression analysis by ordinary least squares will be used. The results observed will be contrasted with the consequences or limitations indicated in the Financial Discipline Law of the Federal Entities and Municipalities. Specifically, it focuses on entities with high levels of indebtedness and entities under observation to see the response to these incentives which limit or ban new loans. The results will be analyzed to see public policy implications of the current structure and where appropriate recommendations will be made to improve the current system.