IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

A Longitudinal Parametric Approach to Estimate Local Government Efficiency

Previous empirical works on municipal efficiency have mostly used cross-sectional data which makes it impossible to separate unobserved heterogeneity from inefficiency. Furthermore, they have also typically used a two stages approach which has been widely criticized as the assumptions made in the first stage are violated in the second stage, generating biased results. We present one of the first longitudinal parametric studies that analyze municipal efficiency and its determinants using a one step procedure. Furthermore, we are the first of this kind that analize overall efficiency as well as efficiency by clusters of municipalities in order to reduce heterogeneity. We use administrative datasets of Chilean municipalities for the 2008-2010 period and our results suggest that Chilean municipalities have on average an inefficiency level of 30% with a significant variance between clusters of municipalities. Also, our results suggest that socio-economic, fiscal and political variables affect municipal efficiency. In particular, we found that municipalities with tighter budget constraints are associated with more efficient municipalities.

(This abstract was borrowed from another version of this item.)

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.uai.cl/RePEc/uai/wpaper/wp_033.pdf
Download Restriction: no

Paper provided by Adolfo Ibáñez University, School of Government in its series Working Papers with number wp_033.

as
in new window

Length:
Date of creation: Mar 2014
Date of revision:
Handle: RePEc:uai:wpaper:wp_033
Contact details of provider: Postal: Av. Pdte. Errázuriz 3485 - Las Condes - Santiago
Phone: (56-2) 369 3560
Fax: (56-2) 369 3576
Web page: http://www.uai.cl/RePEc/uai
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January.
  2. Heikki A. Loikkanen & Ilkka Susiluoto, 2005. "Cost Efficiency of Finnish Municipalities in Basic Service Provision 1994-2002," ERSA conference papers ersa05p37, European Regional Science Association.
  3. Lenka Šastná & Martin Gregor, 2011. "Local Government Efficiency: Evidence from the Czech Municipalities," Working Papers IES 2011/14, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised May 2011.
  4. repec:fgv:epgrbe:v:53:y:1999:i:4:a:761 is not listed on IDEAS
  5. Wang, Hung-jen & Schmidt, Peter, 2001. "One-step and two-step estimation of the effects of exogenous variables on technical efficiency levels," MPRA Paper 31075, University Library of Munich, Germany, revised Mar 2002.
  6. Pitt, Mark M. & Lee, Lung-Fei, 1981. "The measurement and sources of technical inefficiency in the Indonesian weaving industry," Journal of Development Economics, Elsevier, vol. 9(1), pages 43-64, August.
  7. Geys, Benny & Heinemann, Friedrich & Kalb, Alexander, 2010. "Voter involvement, fiscal autonomy and public sector efficiency: Evidence from German municipalities," European Journal of Political Economy, Elsevier, vol. 26(2), pages 265-278, June.
  8. Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
  9. William Greene, 2002. "Fixed and Random Effects in Stochastic Frontier Models," Working Papers 02-16, New York University, Leonard N. Stern School of Business, Department of Economics.
  10. William Greene, 2003. "Distinguishing Between Heterogeneity and Inefficiency: Stochastic Frontier Analysis of the World Health Organization’s Panel Data on National Health Care Systems," Working Papers 03-10, New York University, Leonard N. Stern School of Business, Department of Economics.
  11. Angel Prieto & José ZofIo, 2001. "Evaluating Effectiveness in Public Provision of Infrastructure and Equipment: The Case of Spanish Municipalities," Journal of Productivity Analysis, Springer, vol. 15(1), pages 41-58, January.
  12. Kodde, David A & Palm, Franz C, 1986. "Wald Criteria for Jointly Testing Equality and Inequality Restriction s," Econometrica, Econometric Society, vol. 54(5), pages 1243-48, September.
  13. Kumbhakar, Subal C & Ghosh, Soumendra & McGuckin, J Thomas, 1991. "A Generalized Production Frontier Approach for Estimating Determinants of Inefficiency in U.S. Dairy Farms," Journal of Business & Economic Statistics, American Statistical Association, vol. 9(3), pages 279-86, July.
  14. Greene, William, 2005. "Reconsidering heterogeneity in panel data estimators of the stochastic frontier model," Journal of Econometrics, Elsevier, vol. 126(2), pages 269-303, June.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:uai:wpaper:wp_033. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Claudio A Agostini)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.