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The Impact of Reducing the Administrative Costs on the Efficiency in the Public Sector

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  • Matei, Ani
  • Savulescu, Carmen

Abstract

The goal of the paper is to evaluate the impact of reducing the administrative costs on the efficiency in the public sector. Within the general framework provided by the specialised literature, the proposed methodology uses the classical model of a function of production, thus describing the factors of influence of the administrative costs on production and productivity in the public sector. The theoretical results are empirical exemplified for a local service of public utility. Adapting the theoretical model to the empirical situation is grounded on statistic methods of analysis and regression. The interpretation of results inscribes in the economic framework specific for public economics. The results aim both the novel model of analysis and the concrete evaluation of the economic impact of reducing the administrative expenditure in the public sector. At the same time, the general topic of reducing the administrative costs is extended towards the public sector. The most relevant conclusion refers to the capacity of the classical economic models in developing the public sector

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File URL: http://mpra.ub.uni-muenchen.de/19018/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 19018.

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Date of creation: 15 Feb 2009
Date of revision: 15 Nov 2009
Handle: RePEc:pra:mprapa:19018

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Keywords: administrative costs; efficiency; productivity; public sector;

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  1. António Afonso & Ludger Schuknecht & Vito Tanzi, 2005. "Public sector efficiency: An international comparison," Public Choice, Springer, vol. 123(3), pages 321-347, June.
  2. International Monetary Fund, 1998. "Public Sector Efficiency and Fiscal Austerity," IMF Working Papers 98/56, International Monetary Fund.
  3. António Afonso & Ludger Schuknecht & Vito Tanzi, 2006. "Public Sector Efficiency: Evidence for New EU Member States and Emerging Markets," Working Papers Department of Economics 2006/01, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.
  4. Ani Matei & Lucica Matei, 2007. "Systemic Models of Local Development," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 1(1(506)), pages 11-24, January.
  5. Matei, Ani & Dinu, Teodora, 2009. "Improvement of Government Financing through Non-Conventional Methods: Reducing the Administrative Costs in the Public Sector," MPRA Paper 18905, University Library of Munich, Germany, revised 17 Jun 2009.
  6. Matei, Ani, 2007. "Empirical Approaches About the Input-Output Model for the Local Economic Development: Case Study in Braila Municipality," MPRA Paper 18907, University Library of Munich, Germany, revised 10 Aug 2009.
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