Public Services Performance: An Extended Framework and Empirical Assessment across the Enlarged EU

Abstract

Performance of the public sector is at the core of long-term wealth creation and welfare improvement. Yet, its measurement remains inadequate and flawed with data deficiency. In this paper we propose an extended framework for the assessment of public services performance that accounts for long-term impacts on welfare and empirically evaluate it across twenty-five European countries on the basis of a wide set of proxy indicators. We relate the performance scores to input costs indices and propose a coherent typology of countries that corresponds to the patterns of economic effectiveness of public services. The empirical analysis reveals that, because of differences in input costs across the enlarged EU, the economic effectiveness of public services varies to a much larger extent than the performance, with some relatively large-sized governments (Sweden, Denmark, Austria) being the most effective ones.