Government size and efficiency as constraints to economic growth: comparing Croatia with other European countries

Bađun, Marijana; Pribičević, Vedrana; Deskar-Škrbić, Milan

doi:10.1080/14631377.2014.937089

Cited by 9 publications

(8 citation statements)

References 25 publications

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“…It has been discussed in numerous empirical studies (e.g. Bađun, Pribičević, & Deskar-Škrbić, 2014;Oto-Peralías & Romero-Ávila, 2013;Tridico, 2007). A body of literature has also argued that exports make an important contribution to economic growth (e.g.…”

Section: Introductionmentioning

confidence: 98%

Export-led growth: the case of the Slovenian and Estonian economies

Trošt

Bojnec

2016

Post-Communist Economies

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The export-led growth hypothesis is investigated in the case of the two small, open and export-oriented Slovenian and Estonian economies. The Johansen cointegration test and Granger causality test were applied to investigate the relationship between the time series variables for export, import and gross domestic product (GDP). The results reveal evidence to support the export-led growth hypothesis in both economies. The Granger causality relationship is found between export growth and economic (GDP) growth for both countries. Slovenia and Estonia can enhance economic growth by providing a better enabling environment for exporters and by market expansion.

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Section: Introductionmentioning

confidence: 98%

Export-led growth: the case of the Slovenian and Estonian economies

Trošt

Bojnec

2016

Post-Communist Economies

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“…Determinants of Public Health Care, Education... 19(4), cording to public sector performance (PSP) and public sector efficiency (PSE) indices, countries with public expenditure of around 30% of GDP tend to be the most efficient. Bađun, Pribičević and Deskar-Škrbić (2014) found the average optimal government size for old EU member states to be larger than the size for new EU member states. They applied a DEA/ Tobit input-oriented methodology to a sample of EU member states plus Iceland and Norway, and found that countries should, on average, reduce their general government expenditure (% of GDP) by 3.54 p. p. to reach the optimal government size, which was 39.21% for the sample.…”

Section: Literature Reviewmentioning

confidence: 96%

“…When it comes to public administration expenditure efficiency, it was found to be higher in old than in new EU member states (Bađun, Pribičević & Deskar-Škrbić, 2014). Estonia was found to be highly efficient in several studies, whilst Romania and Bulgaria repeatedly achieved poor results, followed by the Czech Republic.…”

Section: Hkjumentioning

confidence: 97%

“…Romania, Bulgaria, and the Czech Republic had the lowest efficiency score for the public administration subindicator, whilst Estonia and Slovenia showed the highest efficiency among new member states. In their paper Bađun et al (2014) conducted a DEA/Tobit analysis on EU/OECD countries and found that among new member states Bulgaria, Romania, and Croatia were the worst performers, whereas Estonia achieved the highest score. Buljan, A., Deskar-Škrbić, M., & Šimović, H. (2019).…”

Section: Hkjumentioning

confidence: 99%

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Determinants of Public Health Care, Education and Administration Efficiency in Central, Eastern and South Eastern Europe

2019

Self Cite

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This paper analyses determinants of public sector efficiency in 15 Central Eastern and South Eastern European (CESEE) countries. Using Data Envelopment Analysis (DEA) and panel Tobit regressions we analyse the efficiency of public expenditure on health care, education, and public administration. This paper represents the first analysis of public expenditure efficiency for this region. The countries in the sample share a similar economic transition background and transition related challenges in terms of government size and efficiency. In this paper we use input-oriented DEA to calculate efficiency scores and apply Tobit regressions to identify the determinants of public expenditure efficiency for each category. According to our results, the health care sector shows the most room for improvement. With an average input efficiency score of 0.87, the analysed countries could attain the same output with an average 13% fewer resources. The results show that Bulgaria, Estonia, and Slovenia are the most efficient, whilst Serbia, Croatia, and Bosnia and Herzegovina are the worst performers. GDP per capita has a positive effect on efficiency in the health care sector, the rising share of the elderly population reduces the efficiency coefficient, whilst a higher level of education has a positive effect on the efficiency score, as recorded in earlier studies. In education, our results suggest that countries waste an average 10% of their resources. The Czech Republic, Estonia, Poland, Romania, and the Slovak Republic represent the frontier, while the worst performers are Slovenia, Lithuania, and Latvia. The results show that GDP per capita has a positive effect on efficiency in the education sector, whilst a higher unemployment rate leads to lower efficiency scores. Regarding public administration, the average efficiency score of the analysed countries is 0.9, which indicates that countries are wasting an average 10% of their resources. Estonia and Romania are fully efficient, whilst Montenegro, Bosnia and Herzegovina, and Hungary are the most inefficient countries in the sample. As expected, GDP per capita and institutional quality have positive effects on the efficiency of public administration.

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“…to check whether public sector expenditure (on health, education and infrastructure, for example) pays off in terms of social and economic outcomes (e.g. Afonso et al, 2005;Hauner and Kyobe, 2010;Badun et al, 2014). The closest DEA applications are, however, those that have studied the macroeconomic performance of countries, taking into account variables such as total government expenditure, tax burden, fiscal deficit, debt and Gross Domestic Product The reason why we need to consider a non-monotonic DEA approach in this application is because there is ample empirical evidence of an inverted U-shaped relationship between government spending and GDP growth, the so-called BARS curve (Facchini and Melki, 2013;Badun et al 2014).…”

Section: Application To Macroeconomic Efficiency Of Eu Governmentsmentioning

confidence: 99%

DEA with non-monotonic variables. Application to EU governments’ macroeconomic efficiency

Villa

Lozano

2016

Journal of the Operational Research Society

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Conventional Data Envelopment Analysis (DEA) considers monotonic variables, i.e. the lower the inputs and the larger the outputs, the better. There are, however, occasions when the monotonicity of a variable with respect to efficiency depends on the value of the variable, i.e.in a certain range of values an increase in the variable is desirable, while in another range it is a decrease of the variable that is desirable. In this paper, a DEA model that solves problems considering non-monotonic variables is proposed. An application to assess the macroeconomic efficiency of European Union (EU) Member States, as regards taxation, gross debt, GDP growth and employment is presented.

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Government size and efficiency as constraints to economic growth: comparing Croatia with other European countries

Cited by 9 publications

References 25 publications

Export-led growth: the case of the Slovenian and Estonian economies

Export-led growth: the case of the Slovenian and Estonian economies

Determinants of Public Health Care, Education and Administration Efficiency in Central, Eastern and South Eastern Europe

DEA with non-monotonic variables. Application to EU governments’ macroeconomic efficiency

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