Abstract
Judicial courts form a stringent example of public services using partially sticky inputs and outputs with heterogeneous quality. Notwithstanding, governments internationally are striving to improve the efficiency of and diminish the budget spent on court systems. Frontier methods such as data envelopment analysis are sometimes used in investigations of structural changes in the form of mergers. This essay reviews the methods used to evaluate the ex post efficiency of horizontal mergers. Identification of impacts is difficult. Therefore, three analytical frameworks are applied: (1) a technical efficiency comparison over time, (2) a metafrontier approach among mergers and non-mergers, and (3) a conditional difference-in-differences approach where non-merged twins of the actual mergers are identified by matching. In addition, both time heterogeneity and sources of efficiency change are examined ex post. The method is applied to evaluate the impact on efficiency of merging the Swedish district courts from 95 to 48 between 2000 and 2009. Whereas the stated ambition for the mergers was to improve efficiency, no structured ex post analysis has been done. Swedish courts are shown to improve efficiency from merging. In addition to the particular application, this work may inform a more general discussion on public service efficiency measurement under structural changes, and their limits and potential.
Highlights
More effective utilization of public services is a general target for governments
The empirical analysis is presented from our three analytical frameworks: (1) an overview of how the average performance has changed over time is provided together with sources of the development, (2) a metafrontier analysis is performed over the time period 2012–2017 separated between merged and unmerged courts, and (3) a conditional DiD procedure of merged courts in relation to their matched twin is presented followed by an analysis of the sources of efficiency change
28 Staff-weighted efficiency scores are obtained as a weighted mean based on the size of the courts measured as number of employees, i.e. the sum of the three staff-categories
Summary
More effective utilization of public services is a general target for governments. Whereas the demand for increased capacity and quality of performed services may be infinite, the scarcity of allocated resources through public funds or direct fees forces a critical review of the efficiency of the service provision. The measurement of output may be challenging both in terms of quantification (aggregation) and in terms of quality dimensions. The inputs, both in terms of senior staff (e.g. judges) and assets (e.g. court houses) may be of fixed or at least semifixed (sticky) character as, for example, argued by Ouellette and Vierstraete (2010). This means that adjustments to performed output may be slow or non-existent. The ex ante arguments presented in this regard include economies of scale, economies of scope, improved central coordination, improved operational risk sharing and higher efficiency and lower cost (Bogetoft and Wang 2005). OECD (2011) states that ex post evaluations of mergers is an important tool for reviewing previous decisions and creating future improvements
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
