Corruption, Accountability and Efficiency. An Application to Municipal Solid Waste Services
AbstractThis paper explores the link between accountability, corruption and efficiency in the context of a career concern model where politically connected local monopolies are in charge of the provision of a local public service. We find that both corruption and a low degree of accountability induce managers to reduce effort levels, thereby contributing to drive down efficiency. Our predictions are tested using data on solid waste management services provided by a large sample of Italian municipalities. The results of the estimation of a stochastic cost frontier model provide robust evidence that high corruption levels and low degrees of accountability substantially increase cost inefficiency. Finally, we show that the negative impact of corruption is weaker for municipalities ruled by left-wing parties, while the positive impact of accountability is stronger if the refuse collection service is managed by limited liability companies.
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Bibliographic InfoPaper provided by Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino in its series Working papers with number 022.
Length: 34 pages
Date of creation: Jul 2013
Date of revision:
corruption; accountability efficiency; solid waste.;
Find related papers by JEL classification:
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
- L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
- Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-08-05 (All new papers)
- NEP-CDM-2013-08-05 (Collective Decision-Making)
- NEP-EFF-2013-08-05 (Efficiency & Productivity)
- NEP-EUR-2013-08-05 (Microeconomic European Issues)
- NEP-NPS-2013-08-05 (Nonprofit & Public Sector)
- NEP-PBE-2013-08-05 (Public Economics)
- NEP-REG-2013-08-05 (Regulation)
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