Public Auditors: Empirical Evidence from the US States
AbstractPublic auditors should reduce agency problems and improve transparency. We address the question of whether auditors should be elected by the citizens or appointed by either the legislature or the executive, and explore the influence of conducting performance audits. We construct a unique dataset at the US State level capturing differences in the institutional design of state auditing institutions. We estimate the influence of auditor characteristics on different outcome variables reflecting government performance and implement an alternative identification strategy relying on citizens? electoral decisions. We examine whether citizens use divided government ? a costly mechanism to control the government ? as a substitute, when other effective, but less costly mechanisms are not available. Even if the empirical results are sometimes difficult to interpret, we generally find that (1) performance audits tend to be beneficial and (2) elected auditors with a strong mandate to conduct performance audits seem to outperform other institutional arrangements.
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Bibliographic InfoPaper provided by Center for Research in Economics, Management and the Arts (CREMA) in its series CREMA Working Paper Series with number 2008-04.
Date of creation: Mar 2008
Date of revision:
Public auditors; audit courts; political institutions; political economics;
Find related papers by JEL classification:
- D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
- H10 - Public Economics - - Structure and Scope of Government - - - General
This paper has been announced in the following NEP Reports:
- NEP-ACC-2008-04-12 (Accounting & Auditing)
- NEP-ALL-2008-04-12 (All new papers)
- NEP-CDM-2008-04-12 (Collective Decision-Making)
- NEP-PBE-2008-04-12 (Public Economics)
- NEP-POL-2008-04-12 (Positive Political Economics)
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- Blume, Lorenz & Voigt, Stefan, 2011. "Does organizational design of supreme audit institutions matter? A cross-country assessment," European Journal of Political Economy, Elsevier, vol. 27(2), pages 215-229, June.
- Iulian Bogdan Dobra & Attila Szora Tamas, 2009. "The Public Internal Audit Committee In The Social Health Insurance Sector- A Necessity In Romania," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 1(11), pages 54.
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