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Need Equalization transfers and Productive Efficiency of Local Governments

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Abstract

We analyse, with a simple stylized model, the impact of the change of parameters of Need equalization formula for intergovernmental grants on productive efficiency of a local government providing a public service. In our context, this kind of efficiency means producing, at minimum costs and at high quality, a output level at least equal to a minimum standard, fixed by the central government for pursuing horizontal equity among jurisdictions.

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File URL: http://www.disei.unifi.it/upload/sub/pubblicazioni/repec/pdf/wp14_2010.pdf
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Bibliographic Info

Paper provided by Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa in its series Working Papers - Economics with number wp2010_14.rdf.

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Length: 23 pages
Date of creation: 2010
Date of revision:
Handle: RePEc:frz:wpaper:wp2010_14.rdf

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Keywords: Need Equalization; local public services provision; quality and costefficiency;

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  1. Duc Hong Vo, 2010. "The Economics Of Fiscal Decentralization," Journal of Economic Surveys, Wiley Blackwell, vol. 24(4), pages 657-679, 09.
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