Local Government Efficiency Research Articles

Local government efficiency: determinants and spatial interdependence

ABSTRACTWe analyse the determinants of local government efficiency taking into account the presence of spatial interactions among neighbouring municipalities. To do so, first we estimate an efficiency index using the robust order-m methodology in Valencian municipalities (Spain). Second, we examine the socio-economic, political and budgetary factors that might influence efficiency levels. Finally, we analyse the spatial interactions present in our data. The results of estimating a spatial autoregressive model show that government efficiency in neighbouring municipalities positively affects the local government’s own efficiency. This highlights the importance of considering spatial dependence structures in studies on efficiency in the public sector.

Evaluating local government performance in times of crisis

ABSTRACTIn recent years, Spanish local governments have come under increasing pressure to accommodate severe economic restrictions while maintaining their provision of local public services. We analyse overall cost efficiency in Spanish local governments during the period of the economic crisis (2008–2013), under four different non-parametric methodologies. Moreover, given how problematic it is to precisely define what municipalities do, we compare three different output models with various measures of quantity as well as quality. Results suggest that Spanish local government efficiency improved over the period 2008–2013 since budget expenditures (inputs) fell while local public services and facilities (outputs) were maintained. We also find evidence of the possible implications of service quality when measuring municipalities’ efficiency, and of structural differences in the average efficiency between municipalities located in different Spanish regions. Finally, our results confirm that the level and variation of efficiency scores are affected by the approach taken.

INSTITUTION EFFICIENCY VERSUS THE LEVEL OF DEVELOPMENT OF LOCAL GOVERNMENTS (A STUDY AT THE LEVEL OF POLAND’S REGIONAL DIVISION)

As the socio-economic reality is growing increasingly complex, the role of local governments in the management of events and processes occurring in local communities gains importance. Considering the fact that the basic task of local authorities is to stimulate the growth and development of a given local entity, an analysis was undertaken to the aim of assessing the relationship between the level of local development and the institutional efficiency of local self-governments and vice versa, in a regional approach (NUTS 2). To achieve this aim, mixed data were analysed, that is raw data (acquired via survey from 1,220 municipalities) and secondary data (from the database of the Local Data Bank). The efficiency of local governments was measured with an aggregate factor EFF, while the level of development was assessed with the DEV measure. The results indicate that the local governments did rather poorly in terms of both efficiency and development. In both cases, the mean value of the applied synthetic measures reached no more than 30% of the maximum attainable score. The basic tools in the research were correlation and regression analysis. Both procedures demonstrated the presence of a relationship between the two analysed categories (r = 0.365). Moreover, the analysis of regression showed that the impact of developmental processes on the improvement of efficiency of local governments was stronger that the influence of improved efficiency on developmental processes occurring in the analysed municipalities.

Fiscal decentralisation and local government efficiency: Does relative deprivation matter?

Fiscal decentralisation arguably improves government efficiency because it enhances responsiveness to local policy issues and incentivises fiscal discipline. However, critics suggest that central control over local spending is necessary to equalise fiscal outcomes between prosperous and deprived areas. Using a two-stage analysis, we investigate the validity of these arguments by analysing the separate and combined effects of fiscal decentralisation and socio-economic deprivation on the productive efficiency of English local governments during 2002–2008. The results suggest that decentralisation is positively related to productive efficiency and that there is a negative relationship between socio-economic deprivation and efficiency. Further analysis reveals that deprivation weakens the positive decentralisation–efficiency relationship, calling into question simplistic proposals for fiscal decentralisation.

Public Policy Environment and Entrepreneurial Activities: Evidence from China

AbstractWhat determines the effectiveness of government entrepreneurship policies on the regional development of entrepreneurial activities in China? Using panel data analysis, this study develops a comprehensive framework that examines the effects of various factors, including government efficiency and government support for business, finance and technology, on facilitating the creation of new ventures. Based on provincial data collected between 2009 and 2014, we find that the level of infrastructure development, government incubators and venture capital‐guided funds have positive and significant effects on entrepreneurial activities. The findings of our study suggest that local government efficiency is a fundamental precondition for entrepreneurship policies to effectively boost the regional economy.

THE IMPLEMENTATION OF MOTIVATIONAL SYSTEMS IN LOCAL-GOVERNMENT MUNICIPAL ENTERPRISES

Municipal companies gain new challenges through competition’s growth and increasing demand from customers while maintaining low prices and high quality of service delivery. Daily use of various public services by the residents raises questions about the extent to which human resources, time, property or the appropriate organizational and legal frame of local government business activity are used. Local government municipal companies, due to their existing organizational and legal nature as well as well-established organizational culture, require continuous changes in the management process in order to improve the quality and financial results while satisfying the expectations of the local community. In this article, the author attempts to answer the question of the possibility of implementing incentive systems in order to increase the efficiency of local government municipal companies.

Chinese Local Bond Spreads, Monetary Policy and Misallocationn

We examine the impact of Chinese monetary policies on excess local bond yields (the spreads over Chinese government bonds), on local bonds issued by Chinese local government entities. We find that an expansion in M2 generally raises the excess yields on bonds issued by local government entities, and the impact is amplified for bonds issued by the local governments. This last category is considered as as having a high degree of existing resource misallocation. Our estimation results confirm that excess yield on local bonds can be an indicator of market risk of local government debts and the financial efficiency of local governments.

Waste management performance in Italian provinces: Efficiency and spatial effects of local governments and citizen action

This paper investigates the waste management performance of Italian provinces in the period 2004–2011. An efficiency analysis through DEA is first implemented in order to assign efficiency scores both to local administrations and citizens. The presence of spatial interdependencies in the waste management performance of governments and citizens together with the persistence of good/bad performance in waste management distribution is then tested. Our results highlight the presence of two clusters showing better performance in north-eastern and southern Italy. The provinces in central Italy performed poorly. A positive spatial correlation for efficiency scores is then found. An interesting result, also for policy makers, is that the joint action of local institutions and citizens reduces the differences between “good” and “bad” provinces, stimulating a convergence process towards better waste management performance. The waste management process is optimised when both citizens and local government behave appropriately.

Local governments' expenditures efficiencies and determinants: the case of Indonesia

This paper investigates the efficiency of local governments' expenditures in Indonesia, setting Human Development as the designated outputs. Annual data of 34 provinces in Indonesia during 2013-2016 are collected for conducting this research. Data envelopment analysis (DEA) is used to measure the efficiency levels. In addition, the efficiencies' performance also measured by using Malmquist index. We found that, during the analysis period, the efficiency levels of local government expenditures of provinces outside of Java Island are still deficient. DKI Jakarta, DI Yogyakarta, and West Java Province are always located in the efficient frontiers. However, East Kalimantan, Papua, and South Sumatera have been the most improved provinces among others. Further study on the impact of exogenous factors affecting the efficiency scores through Tobit regression yields that Population, Government accountability, Democratic Index, number of universities and local investments have a positive-significant impact on the efficiency scores whereas Area coverage correlates negatively.

Absorption of the EU funds in the context of institutional efficiency of local governments in Poland

This article reports an empirical study whose aim was to verify a hypothesis assuming the presence of a relationship between institutional efficiency of local governments and the value of financial means acquired from the EU budget and from other foreign programmes (including the contribution from the state budget as a cofinancing of projects executed with the support of structural funds and the EU Cohesion Fund). The analysis was based on mixed data, i.e. primary (obtained via a survey from 1,220 municipalities) and secondary ones (from the Local Data Bank). The institutional efficiency of local governments was measured with an EFF aggregate metric, which was the sum of weighted synthetic partial metrics determined for the basic areas of activity pursued by local governments, while the identification of relationships was based on one-factor analysis of regression. The results substantiated positive verification of the hypothesis and demonstrated that efficiency (as defined for the purpose of this study) cannot be treated as an exclusive determinant of the absorption of EU funds by municipalities. More important in this respect are the size of a population and budgetary revenues in a given municipality.

Regional Differences between the Rate of Change of CO2 Emission Intensity of Chinese Provinces and Implications for Sustainable Development

AbstractThis paper constructs an efficiency model of carbon emission reduction (ECER), and uses provincial panel data from 1995 to 2014 to examine the factors influencing ECER at province level in China. Results show that TA (technical advancement) and SE (scale effect) dominate ECER, but their effects vary across regions. TE (technical efficiency) has the potential to enhance ECER, given the increased TA in the three studied regions. The negative effect of IS (industry structure) on ECER in the West (the western region) is heavier than that in the central region and the East, while the East (the eastern region) has a lower negative effect of ES (energy structure) on ECER than the central region and the West. To increase the efficiency of emission reduction policies, the central and local governments should consider these regionally heterogeneous factors. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment

The Effect of Capital Expenditure on Local Revenue: Study In East Java Indonesia

In the decentralization era, local independence is the logic consequence of the implementation of fiscal decentralization. Further, fiscal decentralization has potentially to increase economic efficiency of the local government if compared with the central government. This research analyzed the effect of capital expenditure through Regional Gross Domestic Product (RGDP) on Local Revenue. The sample in this study was 38 districts/ cities in East Java province in Indonesia using path analysis. The results showed some findings, first, capital expenditures which divided into productive capital expenditures and less productive capital expenditures has affect on regional gross domestic product. Second, regional gross domestic product has affects on the forming components of local revenue. Furthermore, less productive capital expenditures and productive capital expenditures have indirect effect on local revenue through regional gross domestic product.

The efficiency of local government: The role of privatization and public sector unions

Local governments spend roughly $1.6trillionperyear to provide a variety of public services ranging from police and fire protection to public schools and public transit. However, we know little about public sector's productivity in delivering key services. Public bus service represents a standardized output for benchmarking the cost of local government service provision. Among the top twenty largest cities, there exists significant dispersion in the operating cost per bus mile with the highest being more than three times as high as the lowest. Using a regression discontinuity design, we estimate the cost savings from privatization and explore the political economy of why privatization rates are lower in high cost unionized areas. Our analysis suggests that fully privatizing all bus transit would generate cost savings of approximately $5.7billion, or 30% of total U.S. bus transit operating expenses. The corresponding increased use of public transit from this cost reduction would lead to a gain in social welfare of $524million, at minimum, and at least 26,000 additional transit jobs.

Women Mayors and Management of Spanish Councils: An Empirical Analysis

ABSTRACTThis paper analyzes the relationship between the gender of mayors in Spanish local government and different budget items. It uses a sample of local budgets for 8,112 town councils between 2002 and 2010, totaling 64,361 observations. The Spanish context is characterized by decentralization of public responsibility to a greater extent than in neighboring countries, feeding the debate on the operational efficiency of local government and the importance of gender in public management. Results show that councils with women mayors have lower annual interest and debt repayment obligations and have higher expenditure on security, protection, and social promotion. Thus, the presence of women in politics may serve to improve councils’ economic situations, which is necessary not only for social justice but also for economic efficiency. In addition, in councils with more inhabitants, women mayors are more common, but women are less likely to occupy the office for longer periods.

Factors contributing to the institutional efficiency of local governments in the administrative area

Research background: The theory of endogenous regional development indicates in par-ticular the role of local authorities in creating the conditions for socio-economic development. Among the factors that shape institutional efficiency of local government, the ones referring to the administrative sphere should be especially analyzed.Purpose of the article: The aim of the paper was the assessment of the activities shaping institutional efficiency in the administrative area with respect to the activities pursued by local governments in Poland, and to assess the effects of such activities. The analysis includes activities aimed at streamlining service provision, implementation of a system of self-control of provided services, and measures related to the adjustment of the organizational structure of an office to the implemented tasks.Methods: For the purpose of performing the study a questionnaire was prepared and sent to local authorities in Poland. The research was conducted between 2015 and 2016 on a sample of 1,220 municipalities from 2,479. Identification of activities implemented by local gov-ernments was made on the basis of an analysis of the task implementation index. The evalu-ation of effects of tasks was made on the basis of the values of effect index of implemented tasks.Findings & Value added: Many local governments do not fully apply the available tools that streamline the provision of administrative services. The value of the task performance index had a low average level in Poland (0.42). Representatives of local authorities were convinced of the relatively high efficiency of undertaken activities. The value of the task implementation index in the area of self-control of the provided services remained at the level of 0.48. The average value of effects of activities amounted to 0.55. The average index of task implementation of activities adjusting the organizational structure to the implemented tasks and provided services amounted to 0.64 in Poland.

The Effects of Local Government Performance on Anti-Immigrant Violence and Attitudes

Communities provide a crucial experiential context for native-immigrant interactions, yet we know little about the impact of local government performance on shaping public responses to immigrants. Building on arguments considering efficient governments as critical factors in facilitating immigrant integration and mitigating denizens’ political deprivation, we argue that efficient local governments also play a significant role in reducing anti-immigrant behavior. Using cost efficiency modeling to generate a measure of local government efficiency (LGE), we show high LGE is associated with fewer incidents of anti-immigrant violence in Germany during its unprecedented refugee intake in 2015. Testing the broader implications of our theory, we employ longitudinal data on LGE of Dutch municipalities merged with police records of criminal offenses against immigrants (2012-2015). Results from two-way fixed effects models show a systematic, negative link between efficiency and violence. Our results suggest that improving local governance can have salutary benefits on inter-group relations.

Local Government Efficiency and Anti-immigrant Violence

Communities provide a crucial experiential context for native-immigrant interactions, yet we know little about the impact of local government performance on shaping public responses to immigrants. ...

Efficiency assessment of Portuguese municipalities using a conditional nonparametric approach

Measuring local government efficiency is a complex task that has to take into account that they usually operate in a heterogeneous context. Therefore, the estimation of relative efficiency measures of their performance needs to account for the effect of contextual and exogenous variables. This should assure that the respective measures adequately reflect the portion of inefficiency that may be attributable to local authorities. In this paper, we apply time-dependent conditional frontier estimators to assess the performance of the 278 Portuguese mainland municipalities for the 2009–2014 period. By applying this nonparametric approach, we can avoid the strong assumptions on the specification of the estimated production function required by traditional two-stage methods. Furthermore, we examine the effect of contextual variables and time on the shape of the frontier and the distribution of inefficiencies. The results reveal that the local reforms do not seem to have achieved the pursued objective of improving the efficiency of local government performance. However, we can observe a small improvement in the last year of the period after the amalgamation of some civil parishes, thus it seems that this specific process might have had a certain impact in the short term. Moreover, we find that the economic and demographic indicators included as contextual variables in our model play an important role as influencing the production set, although those effects do not seem to vary much over time. This evidence is corroborated after conducting a second-stage nonparametric regression of the conditional efficiency measures over those variables.

Kinerja Pegawai Dinas Pendidikan Pemuda Dan Olahraga Kota Pekalongan

According to government regulation no. 32 2004 concerning regional governance that the autonomy to the region intended to increase its efficiency and the efficiency of local government , the education office of youth and sports is one of government agencies has a high position as an element implementing in DINDIKPORA. DINDIKPORA have main task to take part of domestic affairs in education , youth and sports , and implement regional decentralization and deconcentration duty in education , youth and sports . The purpose of the research is to identify and analyze the performance, motivation and discipline against the performance of employees and to know the relationship between motivation and discipline with DINDIKPORA of Pekalongan. This research is using quantitative design research with respondents of the employees DINDIKPORA, The process begins with determine the samples from all employees DINDIKPORA of pekalongan .Using a questionnaire to obtained answers for each variable. The results of the study between the correlation of motivation and discipline of the performance of employees DINDIKPORA of pekalongan by using formulas Pearson Correlation there is a correlation between motivation and discipline with the performance of employees. According to the results of the correlation of Pearson, there is a significant correlation between motivation and discipline with the employee performance. The increase in the need to improve the employee performance.

The effect of sub-national institutions and international entrepreneurial capability on international performance of export-focused SMEs: Evidence from China and South Korea

A number of recent studies have taken notice of the differences among sub-national institutions within the convoluted structures of Asian economies. The influence that the institutional environment exerts upon the performance of larger multi-national enterprises (MNEs) in Asian markets is well-documented; however, the relationship between sub-national institutions, international entrepreneurial capability (IEC), and international performance (IP) is a realm that has been less closely explored. This paper seeks to address that gap by assessing the effect of relevant sub-national institutions, namely, local government support, legal rules, government transparency, and government efficiency on the IEC of export-focused small and medium-sized enterprises (SMEs) in two leading Asian economies. The researchers have devised and assessed a model that links sub-national institutions, their IEC and IP. To this end, data was collected from export-focused SMEs in two important emerging markets, China and South Korea. Three rounds of data collection resulted in 217 complete surveys. This paper discusses the analyzed data as well as the theoretical and managerial contributions of those findings.