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Budget Rigidity and Expenditure Efficiency in Slovenia

Author

Listed:
  • Todd D. Mattina
  • Victoria Gunnarsson

Abstract

This paper assesses the relative efficiency and flexibility of public spending in Slovenia compared to the advanced and new EU member states. Spending on health care, education, and social protection is relatively high in Slovenia without achieving correspondingly better outcomes. Inefficiencies appear to stem from the financing mechanisms for social services, institutional arrangements, and the weak targeting of social benefits. In addition, the composition of spending appears to be strongly tilted towards nondiscretionary items that reduce the fiscal room for maneuver. Greater flexibility is needed to facilitate the reallocation of relatively inefficient expenditure into higher priorities. In this manner, medium-term expenditure rationalization can focus on reducing inefficient outlays rather than restraining traditionally flexible components of the budget, such as public investment.

Suggested Citation

  • Todd D. Mattina & Victoria Gunnarsson, 2007. "Budget Rigidity and Expenditure Efficiency in Slovenia," IMF Working Papers 07/131, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:07/131
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    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=20664
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    References listed on IDEAS

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    1. António Afonso & Miguel St. Aubyn, 2004. "Non-parametric Approaches to Education and Health Expenditure Efficiency in OECD Countries," Working Papers Department of Economics 2004/01, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    2. Hodrick, Robert J & Prescott, Edward C, 1997. "Postwar U.S. Business Cycles: An Empirical Investigation," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 29(1), pages 1-16, February.
    3. Antonio Afonso & Ludger Schuknecht & Vito Tanzi, 2010. "Public sector efficiency: evidence for new EU member states and emerging markets," Applied Economics, Taylor & Francis Journals, vol. 42(17), pages 2147-2164.
    4. Simar, Leopold & Wilson, Paul W., 2007. "Estimation and inference in two-stage, semi-parametric models of production processes," Journal of Econometrics, Elsevier, vol. 136(1), pages 31-64, January.
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    Cited by:

    1. Misch, Florian & Gemmell, Norman & Kneller, Richard, 2014. "Complementarity in Models of Public Finance and Endogenous Growth," Working Paper Series 3136, Victoria University of Wellington, Chair in Public Finance.
    2. Vratislav Izák, 2011. "The Welfare State and Economic Growth," Prague Economic Papers, University of Economics, Prague, vol. 2011(4), pages 291-308.
    3. Etibar Jafarov & Victoria Gunnarsson, 2008. "Efficiency of Government Social Spending in Croatia," Financial Theory and Practice, Institute of Public Finance, vol. 32(3), pages 289-320.
    4. Tatjana Slavova, 2008. "A rank order and efficiency evaluation of the EU regions in a social framework," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 35(4), pages 339-367, September.
    5. repec:rnp:ecopol:ep1757 is not listed on IDEAS
    6. Victoria Gunnarsson & Etibar Jafarov, 2008. "Government Spending on Health Care and Education in Croatia; Efficiency and Reform Options," IMF Working Papers 08/136, International Monetary Fund.

    More about this item

    Keywords

    Budgetary policy; Public investment; Slovenia; Government expenditures; Public expenditure efficiency; flexibility of spending; expenditure; public spending; health spending; health care; expenditures;

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