Efficiency Of Public Expenditure Research Articles

Polityka zakupowa państwa jako cel zamówień publicznych

The article focuses on the role of state purchasing policy as the primary aim of public procurement in Poland, considering its key aspects and impact on various spheres of economic activity. It presents detailed analyses of strategic objectives, legal regulations, and implementation practices, demonstrating the complexity and significance of this process for the way the public procurement market functions. The main research objective of the article is to understand the role that state purchasing policy plays in shaping the structure of the public procurement market and its impact on the efficiency of public expenditure and the economic development of the country. Through the analysis of empirical data and observations gathered from various sectors of the economy, the article seeks to illustrate how effective purchasing policy can support market competitiveness, fostering innovation and entrepreneurship development. The article analyzes the state purchasing policy as a key goal of public procurement, and presents its impact on the economy, competitiveness and sustainable development, emphasizing the efficiency, transparency and innovation of procedures.However, the article not only highlights the positive aspects of purchasing policy but also identifies challenges associated with it. Among them are combating corruption, ensuring the transparency of processes, and promoting fair competition. The findings presented may serve as a valuable source of information for political decision-makers and practitioners involved in public procurement management, aiming to improve the Polish public procurement system in the context of changing economic and social trends on the international stage.

Overview of Agricultural Subsidies in India and Its Impact on Environment

Agriculture is vital to India's economic development, providing food security to over 1.4 billion people and employing 58% of the population, while contributing 19-20% to GDP. The government's spending on the agricultural sector has been increasing annually, reaching Rs. 1,25,036 crores in 2023, up from Rs. 1,22,836 crores in 2022. The government provides various forms of agricultural subsidies, both direct and indirect, aimed at spurring growth in the sector. However, the efficacy of these subsidies in achieving intended outcomes remains questionable. This paper provides an overview of agricultural subsidies in India by examining the allocation of funds under different schemes. It also analyzes the different types of subsidies and impact on the environment. The study utilizes secondary data from government and research publications. The findings suggest that while agricultural subsidies help the sector, mismanagement hampers their reach and effectiveness for farmers and the environment. Subsidies have both positive and negative environmental externalities. The paper argues that improved targeting of subsidies is critical to maximize benefits for farmers and minimize unintended consequences. More focused allocation can enhance the efficiency of public expenditure on agricultural subsidies and make them more ecologically sustainable. The study provides insights into reforming India's agricultural subsidy regime to balance productivity, equity, and sustainability concerns.

Creative accounting in Italian public finance: Audit governance and accounting methodology

The performance of state-owned enterprises (SOE) depends on the quality of many essential services, the degree of efficiency and effectiveness of most public expenditure and, often, the financial statement of the participating admin-istrations. There are therefore numerous reasons why the financial statement of these companies should be inspired by the highest quality levels. The results of the research presented here, however, do not confirm this expectation and highlight the limitations caused by an uncritical adoption of the capital company model which, focused on measuring the economic result, proves unable to meet accountability needs generated by the public nature of the resources used and the presence of purposes of general interest.

The efficiency of public expenditures on basic services: The case of South African municipalities

AbstractThis paper examines the efficiency of service delivery across 213 local and metropolitan municipalities in South Africa, focusing on four critical areas: electricity, water, sewerage and waste removal. Utilising a order‐ partial frontier efficiency analysis (PFEA), the study calculates output‐oriented efficiency scores for each municipality, incorporating adjustments for service quality based on an ‘infrastructure quality‐index’. Our empirical findings indicate marked variations in efficiency, with electricity services exhibiting the highest efficiency rate at 35%, while waste removal lags behind at 22%. Additionally, municipalities centred around small urban towns are found to be more efficient, challenging the widely held view that larger municipalities are better equipped for efficient service delivery. The analysis offers empirical insights into local government performance in South Africa, underscoring the need for targeted policy interventions to address efficiency gaps. These results not only inform fiscal and administrative decentralisation strategies but also set the groundwork for future research exploring the underlying factors affecting municipal efficiency.

Evaluating Public Spending Efficiency and its Determinants Towards Social Outcomes: Empirical Evidence from Indian States

The topic of public expenditure efficiency has gained a key position in the spheres of public policy goals. This article tries estimating the efficiency of public spending on health and education sectors across Indian states from 1990–1991 to 2016–2017. In input–output linkage, we have computed efficiency using a slacks-based measure model of data envelopment analysis through different orientations. The study also captures the externalities of public spending efficiency with some exogenous factors. It also suggests that these exogenous factors (such as good governance, per capita income and proportion of literates in the household) have significantly improved the output efficiency score of the health as well as the education sectors across Indian states. JEL Codes: H51, H52, H21, E61

Efficiency of Public Expenditure in Sumatera before Covid-19 Pandemic Era

This study will analyze the efficiency of local government expenditure towards the Human Development Index (HDI) indicators achievement. To see the realization, this study will conduct an efficiency analysis of local government expenditures in Indonesian’s 34 provinces at 2015-2018 periods. Furthermore, this study tries to find out which sectors are affect efficiency, and conducts a descriptive analysis of the effect of the covid 19 pandemic on these sectors. Based on the study result, it can be suggested to the local government as follows; Provinces that have reached maximum efficiency levels must be able to maintain government performance by maintaining a large portion of inputs, and continue to work to increase output. So that the level of community welfare can be maintained, or even increased in the following year. In general, its necessary to optimize in terms of the effectiveness of the budget for education, health and public services on the input side for all provinces. Meanwhile, from the output side, the target Life expectancy and Expected Years of Schooling need to be improved.

Assessing Fiscal Sustainability: A Comprehensive Analysis of Brazil's Continuous Cash Benefit (BPC) Program

This paper analyzes the Brazilian social benefit known as Continuous Cash Benefit Programme (BPC), considering its rules, resource utilization, potential impacts,and adverse effects on society. The literature review was based on the Austrian Theory of Economic Intervention.We observed that the BPC needs to be reassessed regarding values, long-term sustainability, and control of adverse effects. Results showed that the value of the BPC per capita is higher than the value of other social benefits in Brazil. 37% of the budget for the analyzed social programs is allocated to the BPC, but it reaches only 18% of the total number of beneficiaries. The benefit amount is also higher than the nominal per capita household income of more than 40% of the Brazilian Federal Units. Since the BPC amount is tied to the minimum wage, which historically experiences real increases in value, and Brazilian data indicate a process of population aging, we expect that expenditures on the benefit will significantly rise in the coming decades. Additionally, we have observed that the BPC creates an adverse incentive for a portion of the population not to contribute to the country's social security system, as they anticipate fitting into the BPC's rules upon retirement. For the sake of public expenditure efficiency and fiscal sustainability, the value and rules of the BPC should be reviewed.

Assessment of public education expenditure efficiency across Lithuanian municipalities

Abstract Efficiency of education expenditure is the ability to maximize the educational achievement given the resources invested. Although public education expenditure tends to increase, yet this does not necessarily guarantee high quality of education services. This study aims to assess public education expenditure efficiency of Lithuanian municipalities and to identify the factors explaining its variations. The study used data for 2013-2019 from 60 Lithuanian municipalities. Corrected Ordinary Least Squares method was employed for public education expenditure efficiency assessment and regression analysis was used to determine its influencing factors. Inputs included financial (public expenditure for education and maintenance) and nonfinancial (composition of teachers, occupied area, etc.) variables. Passing ratio of Lithuanian (national) language and math exams were used as efficiency outputs. The context variables represented environmental factors of educational achievements, such as number of business entities, users of social housing, libraries, and culture centres as well as municipalities’ overall financial autonomy. Results of the research are ambiguous. When assessed by the overall passing of the exams, the efficiency was high, scoring 86-90%. But when evaluated by passing exams with the highest scores, it did not even reach 40%. Two types of public expenditure were identified as the most influential factors - public expenditure for education with the negative trend, and municipality own financing with the positive influence on the public education expenditure efficiency. Such results support the decentralization of public education expenditure management and call for alternative output measures in the Lithuanian public education system.

Impact of urban form on housing affordability stress in Chinese cities: Does public service efficiency matter?

Residential housing affordability stress is an important catalyst of class solidification and the growing worldwide social divide. Based on a quantitative spatial model that considers government utility and decision-making and uses nighttime lighting data, this study utilizes potential urban footprint as an instrumental variable to examine the mechanisms underlying the effects of the urban form on housing affordability stress and the moderating effect of government public service expenditure efficiency. The theoretical model and empirical results indicate the following. (i) The compact urban form increases housing affordability stress through productivity and urban living amenities. (ii) The efficiency of government public service expenditures affects industrial agglomeration externalities and public service accessibility, precipitating a negative moderating effect on the relationship between urban form and housing affordability stress. (iii) Based on LandScan data, a polycentric layout was found to weaken the compact urban form's ability to reduce housing affordability stress and reduce the government spending efficiency's negative moderating effect on public services. These findings demonstrate that the positive externalities of agglomeration production and the rationalization of government public service expenditures play important roles in housing market stabilization, which is helpful in facilitating better resource factor allocations by the government in the urban sprawl process.

Can local People's Congress supervision improve the expenditure behavior of local governments? Evidence from provincial budget review

The Local People's Congress budget review and supervision is an important measure to “effectively safeguard and improve people's livelihood” under the changes of the current major contradictions. Using the multi period DID method, we found that after the revision of the regulations, the local people's livelihood public service expenditure bias and expenditure efficiency were significantly improved. This conclusion is still valid after considering a series of robustness tests and possible explanations. The specific ways for it mainly include the constraint on the opportunistic behavior of local governments and the signal transmission function of the LPC's supervision. Further research shows that more effective media attention, more open and transparent rule of law environment, greater financial pressure and regional differences can all affect the effect of LPC's supervision of spending behavior. The research conclusion shows that the role of LPC supervision should be further played to ensure the development of local people's livelihood and promote the construction of government revenue and expenditure management system.

Do public health expenditures affect maternal and child health in Madagascar?

BackgroundPrevious studies have argued that the relationship between health expenditures and health outcomes is more significant among the poor than the non-poor. However, public spending alone does not improve health status. Quality of governance is considered not only as an important determinant of health outcomes but also of the efficiency of public expenditure on health. In low-income countries, barriers to quality service provision can be observed, which may explain the effects of health expenditures. Therefore, this paper aims to identify the relationship between health expenditures and maternal and child mortality in Madagascar and the potential bottlenecks in the flow of funds for maternal and child health.MethodsUsing panel data, fixed and random effect models for the 22 regions of Madagascar over the period 2010 to 2017 were used. Then bottlenecks related to the flow of funds for maternal and child health were identified.ResultsThe results reveal that, on the one hand, funding for maternal health, mainly constituted by equipment endowments for health facilities, significantly contributes to the improvement of maternal health (-0.35; p-value = 0.00). On the other hand, child health financing, often realized through transfers of funds to the health system, does not affect children’s health (0.22; p-value = 0.88). The bottleneck analysis illustrates that the transferred funds can suffer from delay or misappropriation and only few parts reach beneficiaries.ConclusionsEquipment endowments contributed more to health improvement and would be more effective than monetary financing.

The efficiency of agricultural spending in Italy: A territorial analysis

This paper assesses the efficiency of public agricultural expenditure in each Italian region through the analysis of regional budgets, both as a whole and in relation to specific agricultural policy measures. The degree of integration/complementarity between regional funds and Community funds of the second pillar of the CAP is also evaluated, in order to determine whether European resources are used by the Regions as a substitute for or in addition to regional measures. In Italy, public agricultural funding comes from three sources: the EU, the State, and the regions. While the literature on the effectiveness and efficiency of public spending in agriculture focuses on EU funds, the present research also takes into consideration the agricultural spending of Regions.This original analysis of agricultural spending at the regional level has been made possible by the databank of the CREA (Council for Agricultural Research and Economics), which has been gathering information on the allocations, payments, and remaining balances of regional accounts since 1990. The expenditure items for the agricultural sector included in the regional budgets were reclassified according to an original methodology created by the INEA (National Institute of Agricultural Economics, today CREA). The results show that the overall efficiency of public expenditure has improved over the last two decades (from less than 40% in 2000 to just over 50% in 2019). This improvement is quite evident in the South and the Islands and less so in the North. Agricultural policy measures that can be defined as "short term measures" (contributions to public and private entities involved in agricultural and forestry activities for running costs, such as salaries, telephone, electricity, etc.) show a good spending capacity, while measures requiring planning, such as business investments, still present difficulties. As regards integration/complementarity between regional funds and EU Fund for Rural Development Programmes (RDPs), the regions have been classified depending or whether or not they differentiate between the RDP financing and Budget financing. In the most recent period of 2014-2020, most regions have tended to target both sources of funding to support the same types of priority activities.

Does low urban density increase municipal expenditure? Population density as a performance target for compact city planning in Japan

In depopulating cities, vacant houses and lots are common throughout the urban area, creating low-density urban areas that can lead to inefficiencies in public services and financial deterioration for municipalities. However, despite some studies demonstrating the relationship between population density and public expenditure, no generalized conclusion regarding the essential effect of reducing public expenditure has been reached. Consequently, no method for rationally setting a population density as a performance target for municipalities when developing compact city planning has been established. Thus, this study used the cross-sectional data from Japanese municipalities and the exponentiation regression equation, to determine the strong relationship between population density and per-person public expenditure (PPPE). The findings are particularly noteworthy for municipalities that grew under a nationwide uniform city planning and accounting system, as they provide valuable insights into the generalization of the public expenditure reduction effect. Furthermore, this study developed a method using the exponentiation regression equation, which demonstrated an L-shaped trajectory indicating that PPPE increases at an accelerating rate when population density falls below a certain threshold. Municipalities can evaluate the efficiency of public expenditure simply by applying their population density to the regression equation. They can also verify population density as a performance target. Furthermore, this study revealed the turning point of population density at which the acceleration in the increase in PPPE begins, implying that municipalities can expect a grace period until the turning point.

A network data envelopment analysis based paradigm to benchmark fiscal performance – an analysis of fiscal outlay efficiency among Indian states

PurposeThe fiscal outlay efficiency matters when the performance-based allocation of funds is made to state governments by the central government in a federal structure of an economy like India. Also the efficiency cannon of public expenditure is a key aspect in the field of public economics. Thus, a study to evaluate the efficiency in fiscal outlay of Indian states has been conducted.Design/methodology/approachThe paper offers a three divisions–based paradigm under Network Data Envelopment Analysis framework to compare the performance of fiscal entities (say Indian state governments) in converting available fiscal resources into desired short-run and long-run growth and development objectives. The network efficiency score has been taken as a measure of the quality of fiscal outlay management that is trifurcated into divisional efficiencies representing budgeting process, fiscal outlay efficiency process and fiscal outlay effectiveness process.FindingsIt has been noticed that the states are under performing in achieving short-run growth targets and so the efficiency process division has been identified a major source of fiscal under performance. Suboptimum allocation of fiscal expenditure under various heads within the fiscal resources, as explained under budgeting process, is another major cause of fiscal under performance.Practical implicationsThe study purposes a three divisions–based paradigm that takes into account efficiency of a state in (1) planning budget, (2) achieving short-run growth targets and (3) achieving long-run development targets. These three stages are named as budgeting process efficiency, fiscal outlay efficiency and fiscal outlay effectiveness, respectively. Therefore, a new paradigm called BEE paradigm is proposed to evaluate performance of fiscal entities in terms of fiscal outlay efficiency.Originality/valueIn existing literature on measuring efficiency of public expenditure, the public sector outputs have been made as function of fiscal expenditure as input treating the said outlay as an exogenous variable. In present context, the fiscal expenditure has been treated endogenous to the budgeting process. A high inefficiency on account of budgeting process supports this treatment too.

Efficiency Evaluation of Local Government Expenditures Towards The Human Development Index

The purpose of this study was to analyze the efficiency of government expenditure based Human Development Index (HDI) in Local Government at the Indonesian’s Province using Data Envelopment Analysis (DEA) and Tobit Regression. DEA method used to measure the efficiency of a government entity by using multi-input and multi-output. DEA result also can be used to identify which input or output must be evaluated so that Decision Making Unit (DMU) can increase its efficiency. While tobit model was conducted to investigate the connection of the efficiency result to some variables such as population, size, and differences between Java or non-Java provinces The Result from this research showed that Yogyakarta, Jakarta, Central Java, and East Kalimantan were the most efficient provinces in 2015-2018, while East Java was the most inefficient. This research also indicates that education sector was the main source inefficiency both in input and output variables. Tobit analysis showed that all independent variables used in this study had a significant effect on efficiency. Population and size variables had a negative significant effect on the efficiency, otherwise dummy variables of Java and non-Java has positive significant effect to the efficiency achievement. Keywords: Public Expenditure Efficiency; HDI; DEA; Tobit JEl Classification : D24, H72, H75

The impact of public expenditure on economic growth in Vietnamese localities: Research in the context of the impact of Covid-19

The article studies the impact of provincial public expenditure on economic growth in Vietnamese localities in the context of the impact of Covid-19, with balance panel data of 63 provinces and cities collected in the period 2012 - 2021 (Covid-19 pandemic from 2020 to 2021). The results of the model estimate using the least feasible squared method show that public spending positively impacts economic growth in localities even in the context of the impact of Covid-19. The presence of Covid-19 has had a strong negative effect on economic growth in localities considering both the number of infections and the period of infection and has significantly reduced the impact of public expenditure, extra-budget investment, and human resources. This result is consistent with the actual situation in Vietnam during the Covid-19 pandemic. An interesting finding of the study is that the negative impact of corruption on local economic growth has decreased significantly in the context of the impact of Covid-19. Therefore, improving the efficiency of public expenditure, attracting extra-budget investment, and promoting the efficiency of local labor resources are still important to contribute to promoting economic growth in Vietnamese localities.

Issues and Challenges of Implementing Fiscal Federalism Faced Under the Reform of A Federal State in Nepal

After entering the federalism of Nepal, there was a debate about how the budget transfer would be state and local governance for the development of works. In the early days, although the central government would manage the budget, more problems started to appear in the financial transfer process, according to the policy of gradually leaving the responsibility of all the work including infrastructure development and physical construction to the central government. It seems challenging to establish political commitment in the distribution of resources according to the division of powers in the federal system. Instead of transferring resources, the tendency to centralize resources and manage the work of other levels of government by themselves has not gone away. In the top leadership, the tendency to understand federalism as decentralization rather than division of state power between the levels of government prevails. The second challenge of fiscal federalism is the balance, clarity and inter-level cooperation between the levels of government in matters of taxation and revenue. The revenue source at the state level is very low. All levels of government have distributive allocations, high expansion of current expenditure and weak public fiscal accountability. It seems that the allocated efficiency and productivity of public expenditure should be improved. There is no hesitation to rationalize public expenditure by cutting unnecessary expenditure that does not contribute to public services and financial contribution. A balance is needed between the distribution of responsibilities and financial power. For the successful implementation of financial federalism, it is appropriate to give work responsibilities along with spending arrangements. Based on job responsibilities, it is necessary to arrange resources and develop the ability to perform accordingly. A healthy financial system is the backbone for the successful and proper implementation of federalism in any country. There is no choice but to emulate the federalism of Nepal, which is still a milk child, and move forward with the economic, social and cultural development of the country through a transparent, balanced and predictable financial federalism. For that, we should consider the national interest as the motto to prepare a suitable or implementable action plan and move forward.

Attention, institutional friction, and punctuated equilibrium in China's budget: Changes in social security and employment expenditure

AbstractBased on the literature on punctuated equilibrium theory (PET), we conducted an empirical analysis on the changes in China's social security and employment budget expenditure at the subnational level from 2009 to 2020. We calculated the kurtosis value for 31 provinces to check whether they conform to PET. We used the number of policy documents and resource congestion as indicators of attention allocation and decision cost, respectively, to determine the impacts they have on budget changes. We then performed regression with a fixed effect model. The results show that the budgetary changes of only 20 provinces obey a leptokurtic distribution. Moreover, the allocation of attention by decision makers and institutional friction can explain this pattern of change. This article enriches the empirical study and extends its applicability to PET at the subnational level, especially in authoritarian regimes such as China, and provides some evidence for subsequent research on selecting indicators.Related ArticlesKwon, Sung‐Wook, and Sylvia Gonzalez‐Gorman. 2019. “Influence of Local Political Institutions on Policy Punctuation in Three Policy Areas.” Politics & Policy 47(2): 300–25. https://doi.org/10.1111/polp.12295.Modlin, Steve. 2008. “Defining Involvement of County Commissioners in the Budget Formulation Process.” Politics & Policy 36(6): 1044–65. https://doi.org/10.1111/j.1747‐1346.2008.00149.x.Moreno‐Enguix, María Del Rocío, and Laura Vanesa Lorente Bayona. 2017. “Factors Affecting Public Expenditure Efficiency in Developed Countries.” Politics & Policy 45(1): 105–43. https://doi.org/10.1111/polp.12194.

Analysis of the efficiency of state public expenditure in education and health: the brazilian case after the fiscal responsibility law

The aim of this work was to verify the technical efficiency (i.e., if it is possible use the minimum quantity of inputs required to produce the desired output quantity, given the available technology) of the Brazilian states in relation to public expenditure on health and education after the implementation of the Fiscal Responsibility Law (LRF). For this, a parametric model of stochastic frontier estimation of production and the decomposition of the variation of technical efficiency (VTE) and technological variation by means of the Malmquist index for the Brazilian states were used. Input indicators (expenditure on health and education per capita) were obtained from the National Treasury Secretariat of the Ministry of Finance (Secretaria do Tesouro Nacional/Ministério da Fazenda). Data for output and outcomes in the health area were obtained from Datasus. The data for output and outcomes in the education area were obtained from Ipeadata. The data period is from 2001 to 2012. The results show that, in relation to education expenditures, there is a positive and statistically significant relationship between spending on education per capita and approval rate in secondary education. Regarding the health area, the results show that health expenditures per capita presented a statistically significant and negative relationship with the infant mortality rate in the respective Brazilian states. In relation to the decomposition of the VTE and technological variation through the Malmquist index, all states, both in education and in health, were below the technical efficiency frontier. It should be noted that most of the analyses already carried out of this kind in Brazil focus on the technical efficiency of only the health sector or the education sector separately, while this present work aims to deal with the efficiency of the two sectors.

Efficiency of Public Expenditure on Education in Benin: A Comparative Analysis with the Countries of WAEMU

Efficiency of Public Expenditure on Education in Benin: A Comparative Analysis with the Countries of WAEMU