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Public Sector Efficiency: Evidence for New EU Member States and Emerging Markets

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Author Info
António Afonso
Ludger Schuknecht
Vito Tanzi

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Abstract

In this paper we analyse public sector efficiency in the new member states of the European Union compared to that in emerging markets. After a conceptual discussion of expenditure efficiency measurement issues, we compute efficiency scores and rankings by applying a range of measurement techniques. The study finds that expenditure efficiency across new EU member states is rather diverse especially as compared to the group of top performing emerging markets in Asia. Econometric analysis shows that higher income, civil service competence and education levels as well as the security of property rights seem to facilitate the prevention of inefficiencies in the public sector.

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Publisher Info
Paper provided by Department of Economics at the School of Economics and Management (ISEG), Technical University of Lisbon. in its series Working Papers with number 2006/01.

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Date of creation: 2006
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Handle: RePEc:ise:isegwp:wp12006

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Postal: Department of Economics, School of Economics and Management (ISEG), Technical University of Lisbon, Rua do Quelhas 6, 1200-781 LISBON, PORTUGAL
Web page: http://www.iseg.utl.pt/departamentos/economia/

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Related research
Keywords: government expenditure; efficiency; DEA; new EU member states; emerging markets.;

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Find related papers by JEL classification:
C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Semiparametric and Nonparametric Methods
H40 - Public Economics - - Publicly Provided Goods - - - General
H50 - Public Economics - - National Government Expenditures and Related Policies - - - General

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. António Afonso & Vítor Gaspar, 2006. "Excess burden and the cost of inefficiency in public services provision," Working Paper Series 601, European Central Bank. [Downloadable!]
    Other versions:
  2. De Borger, B, et al, 1994. " Explaining Differences in Productive Efficiency: An Application to Belgian Municipalities," Public Choice, Springer, vol. 80(3-4), pages 339-58, September.
  3. António Afonso & Ludger Schuknecht & Vito Tanzi, 2005. "Public sector efficiency: An international comparison," Public Choice, Springer, vol. 123(3), pages 321-347, June. [Downloadable!] (restricted)
    Other versions:
  4. Tanzi, Vito & Schuknecht, Ludger, 1997. "Reconsidering the Fiscal Role of Government: The International Perspective," American Economic Review, American Economic Association, vol. 87(2), pages 164-68, May. [Downloadable!] (restricted)
  5. Afonso, Antonio & St. Aubyn, Miguel, 2006. "Cross-country efficiency of secondary education provision: A semi-parametric analysis with non-discretionary inputs," Economic Modelling, Elsevier, vol. 23(3), pages 476-491, May. [Downloadable!] (restricted)
    Other versions:
  6. Gupta, Sanjeev & Verhoeven, Marijn, 2001. "The efficiency of government expenditure: experiences from Africa," Journal of Policy Modeling, Elsevier, vol. 23(4), pages 433-467, May. [Downloadable!] (restricted)
  7. António Afonso & Miguel St. Aubyn, 2005. "Non-parametric approaches to education and health efficiency in OECD countries," Journal of Applied Economics, Universidad del CEMA, vol. 0, pages 227-246, November. [Downloadable!]
  8. Luis R. Murillo-Zamorano, 2004. "Economic Efficiency and Frontier Techniques," Journal of Economic Surveys, Blackwell Publishing, vol. 18(1), pages 33-77, 02. [Downloadable!] (restricted)
  9. De Borger, Bruno & Kerstens, Kristiaan, 1996. "Cost efficiency of Belgian local governments: A comparative analysis of FDH, DEA, and econometric approaches," Regional Science and Urban Economics, Elsevier, vol. 26(2), pages 145-170, April. [Downloadable!] (restricted)
  10. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November. [Downloadable!] (restricted)
  11. António Afonso & Werner Ebert & Ludger Schuknecht & Michael Thöne, 2005. "Quality of public finances and growth," Working Paper Series 438, European Central Bank. [Downloadable!]
  12. Ludger Schuknecht & Vito Tanzi, 2005. "Reforming public expenditure in industrialised countries - are there trade-offs?," Working Paper Series 435, European Central Bank. [Downloadable!]
  13. Isabelle Joumard & Per Mathis Kongsrud & Young-Sook Nam & Robert Price, 2004. "Enhancing the Effectiveness of Public Spending: Experience in OECD Countries," OECD Economics Department Working Papers 380, OECD, Economics Department. [Downloadable!]
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Ismihan, Mustafa & Ozkan, F Gulcin, 2007. "Public investment: a remedy or a curse? Examining the Role of Public Investment for Macroeconomic Performance," CEPR Discussion Papers 6139, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  2. Pierre Pestieau, 2007. "Assessing the performance of the public sector," CREPP Working Papers 0703, Centre de Recherche en Economie Publique et de la Population (CREPP) (Research Center on Public and Population Economics) HEC-Management School, University of Liège. [Downloadable!]
  3. António Afonso & Vítor Gaspar, 2007. "Dupuit, Pigou and cost of inefficiency in public services provision," Public Choice, Springer, vol. 132(3), pages 485-502, September. [Downloadable!] (restricted)
  4. Antonio Estache & Marianela González & Lourdes Trujillo, 2007. "Government Expenditures on Education, Health, and Infrastructure: A Naïve Look at Levels, Outcomes, and Efficiency," City University Economics Discussion Papers 07/03, Department of Economics, City University, London. [Downloadable!]
    Other versions:
  5. António Afonso & Vítor Gaspar, 2006. "Excess burden and the cost of inefficiency in public services provision," Working Papers 2006/05, Department of Economics at the School of Economics and Management (ISEG), Technical University of Lisbon.. [Downloadable!]
    Other versions:
  6. Todd D. Mattina & Victoria Gunnarsson, 2007. "Budget Rigidity and Expenditure Efficiency in Slovenia," IMF Working Papers 07/131, International Monetary Fund. [Downloadable!]
  7. Etibar Jafarov & Victoria Gunnarsson, 2008. "Government Spending on Health Care and Education in Croatia: Efficiency and Reform Options," IMF Working Papers 08/136, International Monetary Fund. [Downloadable!]
  8. Antonis Adam & Manthos D. Delis & Pantelis Kammas, 2008. "Fiscal Decentralization and Public Sector Efficiency: Evidence from OECD Countries," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  9. António Afonso & Ludger Schuknecht & Vito Tanzi, 2008. "Income distribution determinants and public spending efficiency," Working Paper Series 861, European Central Bank. [Downloadable!]
    Other versions:
  10. Emanuele, Canegrati, 2008. "Analysis of Intergenerational Inequality: the Role of Public Expenditure and Taxation," MPRA Paper 10926, University Library of Munich, Germany. [Downloadable!]
  11. Konstantinos Angelopoulos & Apostolis Philippopoulos & Efthymios Tsionas, 2007. "Does public sector efficiency matter? Revisiting the relation between fiscal size and economic growth in a world sample," Working Papers 2007_30, Department of Economics, University of Glasgow. [Downloadable!]
    Other versions:
  12. Philippe Widmer & Peter Zweifel, 2008. "Provision of Public Goods in a Federalist Country: Tiebout Competition, Fiscal Equalization, and Incentives for Efficiency in Switzerland," Working Papers 0804, University of Zurich, Socioeconomic Institute. [Downloadable!]
  13. Adam, Antonis & Delis, Manthos D & Kammas, Pantelis, 2008. "Public sector efficiency: Leveling the playing field between OECD countries," MPRA Paper 16493, University Library of Munich, Germany. [Downloadable!]
  14. Martin Heipertz & Melanie Ward-Warmedinger, 2008. "Economic and Social Models in Europe and the Importance of Reform," Financial Theory and Practice, Institute of Public Finance, vol. 32(3), pages 255-287. [Downloadable!]
  15. Jerome Creel & Paola Monperrus-Veroni & Francesco Saraceno, 2007. "Has the Golden Rule of Public Finance Made a Difference in the UK ?," Documents de Travail de l'OFCE 2007-13, Observatoire Francais des Conjonctures Economiques (OFCE). [Downloadable!]
  16. Davide Furceri & Marcos Poplawski Ribeiro, 2008. "Government spending volatility and the size of nations," Working Paper Series 924, European Central Bank. [Downloadable!]
  17. David Hauner & Annette Kyobe, 2008. "Determinants of Government Efficiency," IMF Working Papers 08/228, International Monetary Fund. [Downloadable!]
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