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Public Sector Efficiency: The Roles of Political and Budgetary Institutions, Fiscal Capacity and Democratic Participation

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Author Info

  • Lars-Erik Borge

    ()
    (Department of Economics, Norwegian University of Science and Technology)

  • Torberg Falch

    ()
    (Department of Economics, Norwegian University of Science and Technology)

  • Per Tovmo

    ()
    (Department of Economics, Norwegian University of Science and Technology)

Abstract

The purpose of this paper is to investigate whether efficiency in public service provision is affected by political and budgetary institutions, fiscal capacity, and democratic participation. In order to address this issue we take advantage of a new global efficiency measure for Norwegian local governments. There is strong evidence that high fiscal capacity and a high degree of party fragmentation contributes to low efficiency. In addition we find that increased democratic participation tends to increase efficiency, while a centralized top down budgetary process is associated with low efficiency.

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Bibliographic Info

Paper provided by Department of Economics, Norwegian University of Science and Technology in its series Working Paper Series with number 8407.

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Length: 32 pages
Date of creation: 01 May 2007
Date of revision:
Handle: RePEc:nst:samfok:8407

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Keywords: Public sector efficiency; Political and budgetary institutions; Fiscal capacity; Democratic Participation;

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References

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Citations

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Cited by:
  1. De Witte, Kristof & Geys, Benny, 2012. "Citizen coproduction and efficient public good provision: Theory and evidence from local public libraries," Discussion Papers, Research Professorship & Project "The Future of Fiscal Federalism" SP II 2012-108, Social Science Research Center Berlin (WZB).
  2. Barone, Guglielmo & de Blasio, Guido, 2013. "Electoral rules and voter turnout," International Review of Law and Economics, Elsevier, vol. 36(C), pages 25-35.
  3. da Cruz, Nuno Ferreira & Marques, Rui Cunha, 2014. "Revisiting the determinants of local government performance," Omega, Elsevier, vol. 44(C), pages 91-103.
  4. Benny Geys & Federico Revelli, 2011. "Economic and political foundations of local tax structures: an empirical investigation of the tax mix of Flemish municipalities," Environment and Planning C: Government and Policy, Pion Ltd, London, vol. 29(3), pages 410-427, June.
  5. Lars-Erik Borge & Pernille Parmer & Ragnar Torvik, 2013. "Local Natural Resource Curse?," Working Papers 0014, Centre for Applied Macro- and Petroleum economics (CAMP), BI Norwegian Business School.
  6. Roger Congleton, 2011. "Why local governments do not maximize profits: on the value added by the representative institutions of town and city governance," Public Choice, Springer, vol. 149(1), pages 187-207, October.
  7. Geys, Benny & Heinemann, Friedrich & Kalb, Alexander, 2007. "Local Governments in the Wake of Demographic Change: Efficiency and Economies of Scale in German Municipalities," ZEW Discussion Papers 07-036, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  8. De Witte, Kristof & Geys, Benny, 2010. "Evaluating efficient public good provision: Theory and evidence from a generalised conditional efficiency model for public libraries," Discussion Papers, Research Professorship & Project "The Future of Fiscal Federalism" SP II 2010-14, Social Science Research Center Berlin (WZB).
  9. Alexander Wagner, 2011. "Loyalty and competence in public agencies," Public Choice, Springer, vol. 146(1), pages 145-162, January.
  10. Asatryan, Zareh & De Witte, Kristof, 2014. "Direct democracy and local government efficiency," ZEW Discussion Papers 14-017, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  11. Lars-Erik Borge & Marianne Haraldsvik, 2009. "Efficiency potential and determinants of efficiency: An analysis of the care of elderly sector in Norway," Working Paper Series 10109, Department of Economics, Norwegian University of Science and Technology.
  12. Geys, Benny & Heinemann, Friedrich & Kalb, Alexander, 2009. "Voter involvement, fiscal autonomy and public sector efficiency: evidence from German municipalities," Discussion Papers, Research Unit: Market Processes and Governance SP II 2009-02, Social Science Research Center Berlin (WZB).
  13. Elena Gennari & Giovanna Messina, 2012. "How sticky are local expenditures in Italy? Assessing the relevance of the “flypaper effect” through municipal data," Temi di discussione (Economic working papers) 844, Bank of Italy, Economic Research and International Relations Area.
  14. Lars-Erik Borge & Marianne Haraldsvik, 2009. "Efficiency potential and determinants of efficiency: an analysis of the care for the elderly sector in Norway," International Tax and Public Finance, Springer, vol. 16(4), pages 468-486, August.
  15. Bruns, Christian & Himmler, Oliver, 2008. "Could you hand me the efficiency section, please? Newspaper circulation and local government efficiency in Norway," MPRA Paper 12582, University Library of Munich, Germany.
  16. Yamamura, Eiji, 2010. "Public policy, trust and growth: disclosure of government information in Japan," MPRA Paper 27703, University Library of Munich, Germany.
  17. Cuadrado-Ballesteros, Beatriz & García-Sánchez, Isabel-María & Prado-Lorenzo, José-Manuel, 2013. "Effect of modes of public services delivery on the efficiency of local governments: A two-stage approach," Utilities Policy, Elsevier, vol. 26(C), pages 23-35.
  18. Geys, Benny & Moesen, Wim, 2008. "Measuring local government technical (in)efficiency: An application and comparison of FDH, DEA and econometric approaches," Discussion Papers, Research Unit: Market Processes and Governance 2008-21, Social Science Research Center Berlin (WZB).

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