Cost Efficiency of Finnish Municipalities 1994-2002. An Application of DEA and Tobit methods
Cost efficiency of basic welfare service provision in 353 Finnish municipalities in 1994-2002 is investigated in an ongoing study. The municipal sector has a central role in the Finnish economy as a provider of welfare services. Data Envelopment Analysis (DEA), a non-parametric linear programming method is employed, calculating a best practise production frontier for the decision making units, and comparing the various DMUs with this frontier. The inputs consisted of four to ten of the most important services in health, social and educational sector. As the combined output, total real production costs of these services were used. According to the results efficiency differences were considerable between the municipalities, and a small group of a peripheral municipalities scored clearly below the others. Annual changes in cost efficiency were estimated. At the second stage, differences in the DEA efficiency scores were explained by using Tobit panel models. It was found that larger population and peripheral geographic position tend to reduce efficiency of municipal service production, while higher education level of inhabitants increases it.
|Date of creation:||Aug 2004|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.ersa.org
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.:
- Tanja Kirjavainen & Heikki A. Loikkanen, 1995. "School Resources and Student Achievement: Evidence from Finnish Senior Secondary Schools," Discussion Papers 91, Government Institute for Economic Research Finland (VATT).
- DE BORGER, Bruno & KERSTENS, Kristiaan, 1994.
"Cost efficiency of Belgian local governments: A comparative analysis of FDH, DEA and econometric approaches,"
SESO Working Papers
1994002, University of Antwerp, Faculty of Applied Economics.
- De Borger, Bruno & Kerstens, Kristiaan, 1996. "Cost efficiency of Belgian local governments: A comparative analysis of FDH, DEA, and econometric approaches," Regional Science and Urban Economics, Elsevier, vol. 26(2), pages 145-170, April.
- Balaguer-Coll, Maria Teresa & Prior, Diego & Tortosa-Ausina, Emili, 2007.
"On the determinants of local government performance: A two-stage nonparametric approach,"
European Economic Review,
Elsevier, vol. 51(2), pages 425-451, February.
- Emili Tortosa Ausina & Diego Prior & María Teresa Balaguer-Coll, 2004. "On The Determinants Of Local Government Performance: A Two-Stage Nonparametric Approach," Working Papers. Serie EC 2004-04, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Kirjavainen, Tanja & Loikkanent, Heikki A., 1998.
"Efficiency differences of finnish senior secondary schools: An application of DEA and Tobit analysis,"
Economics of Education Review,
Elsevier, vol. 17(4), pages 377-394, October.
- Kirjavainen, Tanja & Loikkanen, Heikki, 1996. "Efficiency Differences of Finnish Senior Secondary Schools: An Application of DEA and Tobit-Analysis," Discussion Papers 570, The Research Institute of the Finnish Economy.
- DE BORGER, Bruno & KERSTENS, K. & MOESEN, Wim & VANNESTE, Jacques, 1992.
"Explaining differences in productive efficiency: An application to Belgian municipalities,"
SESO Working Papers
1992003, University of Antwerp, Faculty of Applied Economics.
- De Borger, B, et al, 1994. " Explaining Differences in Productive Efficiency: An Application to Belgian Municipalities," Public Choice, Springer, vol. 80(3-4), pages 339-58, September.
When requesting a correction, please mention this item's handle: RePEc:wiw:wiwrsa:ersa04p283. 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: (Gunther Maier)
If references are entirely missing, you can add them using this form.