Factors Affecting Public Expenditure Efficiency in Developed Countries

Abstract

Measuring public efficiency can help governments to benchmark progress, identify gaps, and learn from best practices around the world. Our study designs Public Expenditure Efficiency Indexes, both for general government and for its functions, by using single synthetic indicators, as well as a Free Disposal Hull and a Data Envelopment Analysis model. The study also tests the association between public sector performance and public expenditure efficiency and other key socioeconomic indicators. Empirical analysis was applied in 2012 for a single cross‐section of 35 economies. Results show significant evidence of an association between public efficiency and state of development, democracy, and corruption, as well as with population density, especially in Environmental Protection. The direction of the association between public sector size and public performance differs per function. It is positive for Health and Social Protection.Related Articles Gatchair, Sonia D. 2015. “.” Politics & Policy 43 (): 887‐913. http://onlinelibrary.wiley.com/doi/10.1111/polp.12139/abstract Ariely, Gal. 2011. “.” Politics & Policy 39 (): 997‐1019. http://onlinelibrary.wiley.com/doi/10.1111/j.1747-1346.2011.00329.x/abstract Givel, Michael, and Andrew L. Spivak. 2008. “.” Politics & Policy 36 (): 420‐447. http://onlinelibrary.wiley.com/doi/10.1111/j.1747-1346.2008.00115.x/abstract Related Media 2010. https://www.youtube.com/watch?v=XXTVjXmcxqo 2015. https://www.youtube.com/watch?v=L22-2gdXDg4 2010. https://www.youtube.com/watch?v=Q4mkHu72w1k