Decentralization and efficiency of local government

Annals of Regional Science

Volumn 45, Issue 3, 2010, Pages 571-601

  Balaguer Coll, Maria Teresa ^a   Prior, Diego ^b   Tortosa Ausina, Emili ^a,c  

^a UNIVERSITAT JAUME I   (Spain)

^b UNIVERSITAT AUTÒNOMA DE BARCELONA   (Spain)

^c University of Valencia   (Spain)

Author keywords

D24; D60; H71; H72

Indexed keywords

DECENTRALIZATION; DECISION MAKING; LOCAL GOVERNMENT; POLITICAL POWER;

SPAIN;

EID: 77955745686     PISSN: 05701864     EISSN: 14320592     Source Type: Journal    
DOI: 10.1007/s00168-009-0286-7     Document Type: Article

References (99)

1. Alesina A (1999) Too large and too small governments. In: Tanzi V, Chu K, Gupta S (eds) Economic policy and equity. International Monetary Fund, Washington, DC, pp 216-234.
2. Balaguer-Coll MT, Prior D, Tortosa-Ausina E (2007) On the determinants of local government performance: a two-stage nonparametric approach. Eur Econ Rev 51(2): 425-451.
3. Barankay I, Lockwood B (2007) Decentralization and the productive efficiency of government: evidence from Swiss cantons. J Public Econ 91(5-6): 1197-1218.
4. Bennett RJ (1997) Administrative systems and economic spaces. Reg Stud 31(3): 323-336.
5. Berglas E, Pines D (1981) Clubs, local public goods and transportation models: a synthesis. J Public Econ 15(2): 141-162.
6. Besley T, Coate S (2003) Centralized versus decentralized provision of local public goods: a political economy approach. J Public Econ 87: 2611-2637.
7. Bosch N, Suárez-Pandiello J (1993) Institutional restrictions and local public economics: a Spanish approach. J Public Financ Public Choice 11(2-3): 111-121.
8. Bosch N, Suárez-Pandiello J (1995) Seven hypotheses about public choice and local spending (a test from Spanish municipalities). Public Financ 50(1): 36-50.
9. Bosch N, Pedraja F, Suárez-Pandiello J (2000) Measuring the efficiency of Spanish municipal refuse collection services. Local Gov Stud 26(3): 71-90.
10. Bradford D, Malt R, Oates W (1969) The rising cost of local public services: some evidence and reflections. Natl Tax J 22: 185-202.
11. Cai H, Treisman D (2004) State corroding federalism. J Public Econ 88: 819-843.
12. Cerniglia F (2003) Decentralization in the public sector: quantitative aspects in federal and unitary countries. J Policy Model 25: 749-776.
13. Charnes A, Cooper WW, Rhodes E (1978) Measuring the efficiency of decision making units. Eur J Oper Res 2(6): 429-444.
14. Crook RC, Sverrisson AS (2001) Decentralisation and poverty-alleviation in developing countries: a comparative analysis or, is West Bengal unique? Working Paper 130, Institute of Development Studies (IDS), University of Sussex, Brighton.
15. Davoodi H, Zou H (1998) Fiscal decentralization and economic growth: a cross-country study. J Urban Econ 43(2): 244-257.
16. De Borger B, Kerstens K (1996a) Cost efficiency of Belgian local governments: a comparative analysis of FDH, DEA, and econometric approaches. Reg Sci Urban Econ 26: 145-170.
17. De Borger B, Kerstens K (1996b) Radial and nonradial measures of technical efficiency: an empirical illustration for Belgian local governments using an FDH reference technology. J Prod Anal 7: 41-62.
18. Deller SC (1990) An application of a test for allocative efficiency in the local public sector. Reg Sci Urban Econ 20: 395-406.
19. Deller SC (1992) Production efficiency in local government: a parametric approach. Public Financ 47: 32-44.
20. Deprins D, Simar L, Tulkens H (1984) Measuring labor-efficiency in post offices. In: Marchand M, Pestieau P, Tulkens H (eds) The performance of public enterprises: concepts and measurement, Chap 10. North-Holland, Amsterdam, pp 243-267.
21. Ebel RD, Yilmaz S (2002) On the measurement and impact of fiscal decentralization. Policy Research Working Paper 2809. The World Bank, Washington.
22. Faguet J-P (2004) Does decentralization increase government responsiveness to local needs? Evidence from Bolivia. J Public Econ 88: 867-893.
23. Fan Y (1994) Testing the goodness-of-fit of a parametric density function by kernel method. Econ Theory 10: 316-356.
24. Fan Y, Ullah A (1999) On goodness-of-fit tests for weekly dependent processes using kernel method. J Nonparametr Stat 11: 337-360.
25. Färe R, Grosskopf S, Lovell CAK (1994) Production frontiers. Cambridge University Press, Cambridge.
26. Farrell MJ (1957) The measurement of productive efficiency. J R Stat Soci Ser A 120: 253-281.
27. Fox KJ (2001) Efficiency in the public sector, studies in productivity and efficiency, vol 1. Kluwer, Boston.
28. Garcia-Mila T, McGuire TJ (2002) Fiscal decentralization in Spain: an asymmetric transition to democracy. Technical report, Universitat Pompeu Fabra.
29. Gil Jiménez F (2001) Une analyse des desequilibres financiers des collectivites locales en Espagne. Rev Econ Reg Urbaine 0(3): 369-392.
30. Gilbert G, Picard P (1996) Incentives and optimal size of local jurisdictions. Eur Econ Rev 40(1): 19-41.
31. Giménez V, Prior D (2007) Long-and short-term cost efficiency frontier evaluation: evidence from Spanish local Governments. Fiscal Stud 28(1): 121-139.
32. Giménez VM (2004) Un modelo FDH para la medida de la eficiencia en costes de los departamentos universitarios. Hacienda Pública Española/Revista de Economfa Pública 168(1): 69-92.
33. Grosskopf S, Hayes KJ (1993) Local public sector bureaucrats and their input choices. J Urban Econ 33: 151-166.
34. Grosskopf S, Yaisawarng S (1990) Economies of scope in the provision of local public services. Natl Tax J 43(1): 61-74.
35. Hayes KJ, Chang S (1990) The relative efficiency of city manager and mayor-council forms of government. South Econ J 57: 167-177.
36. Hochman O, Pines D, Thisse J (1995) On the optimal structure of local governments. Am Econ Rev 85(5): 1224-1240.
37. Hughes PAN, Edwards ME (2000) Leviathan vs. Lilliputian: a data envelopment analysis of government efficiency. J Reg Sci 40(4): 649-669.
38. Iimi A (2005) Decentralization and economic growth revisited: an empirical note. J Urban Econ 57(3): 449-461.
39. Inman R, Rubinfeld D (1997) Rethinking federalism. J Econ Perspect 11(4): 43-64.
40. Inman R, Rubinfeld D (1998) Subsidiarity and the European Union. Working Paper 6556, NBER, Cambridge.
41. Keating M (1998) The new regionalism in Western Europe: territorial restructuring and political change. Edward Elgar, Northampton.
42. Kerstens K, Vanden Eeckaut P (1999) Estimating returns to scale using non-parametric deterministic technologies: A new method based on goodness-of-fit. Eur J Oper Res 113: 206-214.
43. Klugman J (1994) Decentralisation: a survey of literature from a human development perspective. Development Programme Occasional Paper 13, United Nations, Human Development Report Office, New York.
44. Ladd HF (1994) Fiscal impacts of population growth: a conceptual and empirical analysis. Reg Sci Urban Econ 24: 661-686.
45. Li Q (1996) Nonparametric testing of closeness between two unknown distribution functions. Econ Rev 15: 261-274.
46. López Guerra L (1987) Constitución Espaola. Tecnos, Madrid.
47. Martinez-Vazquez J, McNab R (2003) Fiscal decentralization and economic growth. World Dev 31(9): 1597-1616.
48. Martins-Filho C, Yao F (2007) Nonparametric frontier estimation via local linear regression. J Econ 141(1): 283-319.
49. Martins-Filho C, Yao F (2008) A smooth conditional quantile frontier estimator. J Econ 143: 317-333.
50. Minis H, Rondinelli D (1990) Administrative restructuring for economic adjustment: decentralization policy in Senegal. Int Rev Adm Sci 56: 447-466.
51. Molero J-C (2001) Analysis of decentralization of public spending in Spain. Public Financ Manag 1(4): 500-556.
52. Monasterio Escudero C, Suárez Pandiello J (1998) Manual de Hacienda Autonómica y Local. Ariel, Barcelona.
53. Moreno L (2002) Decentralization in Spain. Reg Stud 36(4): 399-408.
54. Oates WE (1972) Fiscal federalism. Harcourt Brace Jovanovich, Inc., New York.
55. Oates WE (1988) On the measurement of congestion in the production of local public goods. J Urban Econ 24: 85-94.
56. Oates WE (1993) Fiscal decentralization and economic development. Working Paper 04, Economics Department, University of Maryland.
57. Oates WE (1999) An essay on fiscal federalism. J Econ Lit 37(3): 1120-1149.
58. Olson M Jr (1969) The principle of "fiscal equivalence": the division of responsibilities among different levels of government. Am Econ Rev 59(2): 479-487.
59. Pagan A, Ullah A (1999) Nonparametric econometrics. Themes in modern econometrics. Cambridge University Press, Cambridge.
60. Park BU, Simar L, Weiner C (2000) The FDH estimator for productivity efficiency scores. Econ Theory 16(6): 855-877.
61. Pastor J, Tortosa-Ausina E (2008) Social capital and bank performance: an international comparison for OECD countries. Manchester Sch 76(2): 223-265.
62. Prieto ÁM, Zofío JL (2001) Evaluating effectiveness in public provision of infrastructure and equipment: The case of Spanish municipalities. J Prod Anal 15(1): 41-58.
63. Prior D, Sola M (2000) Technical efficiency and economies of diversification in health care. Health Care Manag Sci 3: 299-307.
64. Prud'homme R (1994) On the dangers of decentralization. Policy Research Working Paper 1252, World Bank, Washington.
65. Prud'homme R (1995) The dangers of decentralization. World Bank Res Obs 10: 201-220.
66. Putnam RD (1993) Making democracy work: civic traditions in modern Italy. Princeton University Press, Princeton, NJ.
67. Rodríguez-Pose A, Bwire A (2004) The economic (in)efficiency of devolution. Environ Plann A 36(11): 1907-1928.
68. Rodríguez-Pose A, Gill N (2005) On the 'economic dividend' of devolution. Reg Stud 39(4): 405-420.
69. Rondinelli D, Nellis J (1986) Assessing decentralization policies in developing countries: the case for cautious optimism. Dev Policy Rev 4(1): 3-23.
70. Ruggiero J (1995) On the measurement and causes of technical inefficiency in local public services: With an application to public education. J Public Admin Res Theory 5(4): 403-428.
71. Sampaio de Sousa M, Stošić B (2005) Technical efficiency of the Brazilian municipalities: correcting nonparametric frontier measurements for outliers. J Prod Anal 24: 157-181.
72. Sewell DO (1996) The dangers of decentralization according to prud'homme: Some further aspects. World Bank Res Obs 11(1): 143-150.
73. Shah A (1999) Fiscal federalism and macroeconomic governance: For better or for worse?. In: Fukasaku K, De Mello LR (eds) Fiscal decentralization in emerging countries: governance issues. OECD, Paris, pp 37-54.
74. Sheather SJ, Jones MC (1991) A reliable data-based bandwidth selection method for kernel density estimation. J R Stat Soc Ser B 53(3): 683-690.
75. Shleifer A (1997) Government in transition. Eur Econ Rev 41(3-5): 385-410.
76. Silverman BW (1986) Density estimation for statistics and data analysis. Chapman and Hall, London.
77. Simar L, Wilson PW (2000) Statistical inference in nonparametric frontier models: the state of the art. J Prod Anal 13(1): 49-78.
78. Simar L, Zelenyuk V (2006) On testing equality of distributions of technical efficiency scores. Econ Rev 25(4): 497-522.
79. Smith BC (1985) Decentralization: the territorial dimension of state. George Allen & Unwin, London.
80. Solé-Ollé A (1997) Tax exporting and redistributive politics: an empirical investigation on the determinants of Spanish local tax structure. Public Financ 52(1): 102-124.
81. Solé-Ollé A (2001) Determinantes del gasto público local: necesidades de gasto o capacidad fiscal. Rev Econ Apl 25: 115-156.
82. Solé-Ollé A, Bosch N (2002) On the relationship between local authority size and expenditure: lessons for the design of intergovenmental transfers in Spain. Technical report, Institut d'Economia de Barcelona, Barcelona.
83. Stewart K (2000) Fiscal federalism in Russia: intergovernmental transfers and the financing of education. Edward Elgar Publishing,.
84. Suárez Pandiello J (1999) Fiscal federalism in Spain. Decentralisation: an unfinished task. In: Fossati A, Panella G (eds) Fiscal federalism in the European Union. Routledge, London.
85. Tanzi V (1995) Fiscal federalism and decentralization: A review of some efficiency and macroeconomic aspects. In: Bruno M, Pleskovic B (eds) Annual World Bank Conference on development economics. World Bank, Washington, pp 295-316.
86. Taylor LL (1995) Allocative efficiency and local government. J Urban Econ 37: 201-211.
87. Tiebout C (1956) A pure theory of local expenditures. J Polit Econ 64: 416-424.
88. Treisman D (2002) Decentralization and the quality of government. Working paper, Department of Political Science, UCLA, Los Angeles.
89. Tulkens H (1993) On FDH efficiency analysis: some methodological issues and applications to retail banking, courts, and urban transit. J Prod Anal 4: 183-210.
90. Tulkens H, Vanden Eeckaut P (1995) Non-parametric efficienct, progress and regress measures for panel data: Methodological aspects. Eur J Oper Res 80: 474-499.
91. Vanden Eeckaut P, Tulkens H, Jamar M-A (1993) Cost efficiency in Belgian municipalities. In: Fried HO, Lovell CAK, Schmidt SS (eds) The measurement of productive efficiency, Chap 12, pp 300-334. Oxford University Press, Oxford.
92. Wallis JJ, Oates WE (1988) Decentralization in the public sector: an empirical study of the state and local government. In: Rosen HS (eds) Fiscal federalism: quantitative studies, National Bureau of Economic Research, Chap 1. University of Chicago Press, Chicago, pp 5-32.
93. Worthington AC (2000) Cost efficiency in Australian local government: a comparative analysis of mathematical programming and econometric approaches. Financ Account Manag 16: 201-223.
94. Worthington AC, Dollery BE (2000a) An empirical survey of frontier efficiency measurement techniques in local government. Local Govern Stud 26: 23-52.
95. Worthington AC, Dollery BE (2000b) Measuring efficiency in local governments' planning and regulatory function. Public Prod Manag Rev 23(4): 469-485.
96. Worthington AC, Dollery BE (2000c) Productive efficiency and the Australian local government grants process: An empirical analysis of New South Wales local government. Aust J Reg Stud 6(1): 95-121.
97. Xie D, Zou H, Davoodi H (1999) Fiscal decentralization and economic growth in the United States. J Urban Econ 45(2): 228-239.
98. Zhang T, Zou H (1998) Fiscal decentralization, public spending, and economic growth in China. J Public Econ 67(2): 221-240.
99. Zhang T, Zou H (2001) The growth impact of intersectoral and intergovernmental allocation of public expenditure With applications to China and India. China Econ Rev 12(1): 58-81.