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Voter involvement, fiscal autonomy and public sector efficiency: evidence from German municipalities

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  • Geys, Benny
  • Heinemann, Friedrich
  • Kalb, Alexander

Abstract

Social and/or political involvement within the population is often argued to enhance public sector performance. The underlying idea is that engagement fosters political awareness and interest and increases the public’s monitoring ability. Still, weak fiscal autonomy can undermine voters’ interest in and demand for an efficient production of public services. In our contribution, we test whether and how voter involvement in the political sphere is related to government performance – in terms of its efficiency – using a broad panel of German municipalities. Our results suggest that voter involvement indeed has a positive impact on cost efficiency. Crucially, however, this efficiency-enhancing effect of voter involvement is significantly positively affected by local governments’ fiscal autonomy. -- Häufig wird argumentiert, dass eine soziale und politische Beteiligung der Bevölkerung die Effizienz des öffentlichen Sektors fördert. Die grundlegende Idee ist, dass dieses Engagement politisches Bewusstsein und Interesse fördert und somit die Möglichkeiten der Öffentlichkeit zur Kontrolle erhöht. Allerdings untergräbt eine schwache Finanzhoheit das Interesse der Wähler und ihre Nachfrage nach einer effizienten Produktion öffentlicher Leistungen. In unserem Beitrag testen wir anhand eines breiten Panels deutscher Kommunen, ob und wie die Beteiligung von Wählern in der politischen Sphäre im Zusammenhang zum Leistungsverhalten einer Regierung – im Hinblick auf Effizienz – steht. Unsere Ergebnisse deuten darauf, dass sich die Beteiligung der Wähler tatsächlich positiv auf die Kosteneffizienz auswirkt. Entscheidend ist jedoch, dass dieser Effizienzfördernde Effekt der Wählerbeteiligung signifikant positiv von der Finanzautonomie der kommunalen Regierungen beeinflusst wird.

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Paper provided by Social Science Research Center Berlin (WZB) in its series Discussion Papers, Research Unit: Market Processes and Governance with number SP II 2009-02.

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Date of creation: 2009
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Handle: RePEc:zbw:wzbmpg:spii200902

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Keywords: Civic engagement; fiscal autonomy; local government; efficiency; stochastic; frontier analysis; German municipalities;

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Citations

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Cited by:
  1. De Witte, Kristof & Geys, Benny, 2013. "Citizen coproduction and efficient public good provision: Theory and evidence from local public libraries," European Journal of Operational Research, Elsevier, vol. 224(3), pages 592-602.
  2. Kalb, Alexander, 2008. "The Impact of Intergovernmental Grants on Cost Efficiency: Theory and Evidence from German Municipalities," ZEW Discussion Papers 08-051, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  3. Witte, Kristof De & Geys, Benny, 2011. "Evaluating efficient public good provision: Theory and evidence from a generalised conditional efficiency model for public libraries," Journal of Urban Economics, Elsevier, vol. 69(3), pages 319-327, May.
  4. Peter Bönisch & Peter Haug & A. Illy & L. Schreier, 2011. "Municipality Size and Efficiency of Local Public Services: Does Size Matter?," IWH Discussion Papers 18, Halle Institute for Economic Research.
  5. Ivo Bischoff & Peter Bönisch & Peter Haug & A. Illy, 2013. "Vertical Grants and Local Public Efficiency," IWH Discussion Papers 1, Halle Institute for Economic Research.
  6. Rafael Sanchez & Francisca Pacheco, 2014. "A Longitudinal Parametric Approach to Estimate Local Government Efficiency," Working Papers wp_033, Adolfo Ibáñez University, School of Government.
  7. Laura Carosi & Giovanna D’Inverno & Letizia Ravagli, 2014. "Global public spending efficiency in Tuscan municipalities," Discussion Papers 2014/175, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
  8. 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.
  9. Ivo Bischoff & Frédéric Blaeschke, 2012. "Window-Dressing and Lobbying in Performance-Budgeting: a Model for the Public Sector," MAGKS Papers on Economics 201212, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  10. António Afonso & Alma Romero & Emma Monsalve, 2013. "Public sector efficiency: evidence for Latin America," Working Papers Department of Economics 2013/20, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.
  11. Alexander Kalb, 2010. "The Impact of Intergovernmental Grants on Cost Efficiency: Theory and Evidence from German Municipalities," Economic Analysis and Policy (EAP), Queensland University of Technology (QUT), School of Economics and Finance, vol. 40(1), pages 21-63, March.
  12. da Cruz, Nuno Ferreira & Marques, Rui Cunha, 2014. "Revisiting the determinants of local government performance," Omega, Elsevier, vol. 44(C), pages 91-103.
  13. Geys, Benny & Moesen, Wim, 2008. "Exploring sources of local government technical inefficiency: evidence from Flemish municipalities," Discussion Papers, Research Unit: Market Processes and Governance SP II 2008-18, Social Science Research Center Berlin (WZB).

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