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Measuring and Explaining Government Inefficiency in Developing Countries

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  • N. VAN DE SIJPE
  • G. RAYP

Abstract

We show the relevance of government expenditure inefficiency using the Barro(1990) model. We estimate government inefficiency for 52 developing countries using a data envelopment analysis. The estimated inefficiencies are subsequently used in a general-to-specific approach in order to identify their determinants. We find the government expenditure inefficiency is primarily determined by governance and political variables, and structural country variables. Economic policy determinants apparently count less. Government inefficiency of the Sub Saharan countries in the sample is substantially higher.

Suggested Citation

  • N. Van De Sijpe & G. Rayp, 2004. "Measuring and Explaining Government Inefficiency in Developing Countries," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 04/266, Ghent University, Faculty of Economics and Business Administration.
    • Handle: RePEc:rug:rugwps:04/266
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    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • O23 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Fiscal and Monetary Policy in Development

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