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Spend more, get more? An inquiry into English local government performance

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Revelli Federico () (University of Turin)

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Abstract

Based on a unique measure of performance of English local governments in the provision of public services (Comprehensive Performance Assessment, CPA), this paper develops a simple analytical framework that fully encompasses the institutional features of the British system of local government finance in order to model the process of performance determination, and uses panel data (2002-2007) to identify the determinants of local government performance. Due to the nature of CPA ratings - measured on a five category (poor to excellent) scale - the empirical work relies on an ordered response approach allowing for cross-sectional heterogeneity. Maximum likelihood estimation of a random effects ordered probit model provides no evidence in support of the “spend more, get more” hypothesis, but rather suggests that spending in excess of centrally set standards has a detrimental effect on local public service performance.

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Paper provided by University of Turin in its series Department of Economics Working Papers with number 200804.

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Length: 33 pages
Date of creation: Apr 2008
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Handle: RePEc:uto:dipeco:200804

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  7. Revelli, Federico, 2006. "Performance rating and yardstick competition in social service provision," Journal of Public Economics, Elsevier, vol. 90(3), pages 459-475, February. [Downloadable!] (restricted)
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  8. Carol Propper & Deborah Wilson, 2003. "The Use and Usefulness of Performance Measures in the Public Sector," The Centre for Market and Public Organisation 03/073, Department of Economics, University of Bristol, UK. [Downloadable!]
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  18. Revelli, Federico, 2008. "Performance competition in local media markets," Journal of Public Economics, Elsevier, vol. 92(7), pages 1585-1594, July. [Downloadable!] (restricted)
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  19. Papke, Leslie E., 2005. "The effects of spending on test pass rates: evidence from Michigan," Journal of Public Economics, Elsevier, vol. 89(5-6), pages 821-839, June. [Downloadable!] (restricted)
  20. Revelli, Federico & Tovmo, Per, 2007. "Revealed yardstick competition: Local government efficiency patterns in Norway," Journal of Urban Economics, Elsevier, vol. 62(1), pages 121-134, July. [Downloadable!] (restricted)
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  22. Jorid Kalseth & Jørn Rattsø, 1998. "Political Control of Administrative Spending: The Case of Local Governments in Norway," Economics and Politics, Blackwell Publishing, vol. 10(1), pages 63-83, 03. [Downloadable!] (restricted)
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