The efficiency of government expenditure: experiences from Africa

Gupta, Sanjeev; Verhoeven, Marijn

doi:10.1016/s0161-8938(00)00036-3

Cited by 319 publications

(276 citation statements)

References 16 publications

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“…18 One can see that the most efficient countries, positioned on the production possibility frontier, are the US, Japan, and Luxembourg. Australia, Ireland and 16 Gupta and Verhoeven (2001) would call countries such as C and D "independently efficient", and country A "not independently efficient." 17 Figure 3 illustrates that country B's input efficiency score is given by X(A)/X(B), which is 0.5, smaller than one, since B is the interior of the production possibility frontier.…”

Section: Fdh-based Expenditure Efficiency Analysismentioning

confidence: 99%

Public sector efficiency: An international comparison

2005

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may E U R O P E A N C E N T R A L B A N K WO R K I N G PA P E R S E R I E E U R O P E A N C E N T R A L B A N K WO R K I N G PA P E R S E R I E S AbstractWe compute public sector performance (PSP) and efficiency (PSE) indicators, comprising a composite and seven sub-indicators, for 23 industrialised countries. The first four sub-indicators are "opportunity" indicators that take into account administrative, education and health outcomes and the quality of public infrastructure and that support the rule of law and a level playing-field in a market economy. Three other indicators reflect the standard "Musgravian" tasks for government: allocation, distribution, and stabilisation. The input and output efficiency of public sectors across countries is then measured via a non-parametric production frontier technique.Keywords: Government expenditure, Efficiency, Free Disposable Hull, Production possibility frontier.JEL Classification Numbers: C14, H50. ECB Working Paper No 242 July 20035 Non-technical summaryIn this paper we study the performance and the efficiency of the public sectors of 23 industrialised OECD countries. We compute public sector performance (PSP) and efficiency indicators (PSE) for the government as whole and for its core functions. When deriving performance indicators we distinguish the role of government in providing "opportunities" and a level playing field in the market process and the traditional "Musgravian" tasks of government. "Opportunity"indicators look at administrative, education, health, and public infrastructure outcomes. "Musgravian" indicators assess governments' performance in allocation, distribution, and stabilisation. A number of socio-economic indicators serve as proxies for performance.In assessing the efficiency of public sectors, we look at total public spending and a number of spending categories as proxies for resource use. These are set in relation to performance indicators as they can be seen as reflecting the opportunity costs of public sector activities. The ratio of performance indicators and public spending yields indicators of efficiency for each country.Finally, we use a non-parametric framework to compute a so-called production possibility frontier, and calculate input efficiency and output efficiency scores in order to rank the sample countries in terms of public spending efficiency.We find that the difference in overall performance is moderate across the sample countr...

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Section: Fdh-based Expenditure Efficiency Analysismentioning

confidence: 99%

Public sector efficiency: An international comparison

2005

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“…The resources devoted to the health system are approximated by per capita total expenditure in health in purchasing power parity of $US (PPP). Using PPP expenditure facilitates cross-country comparisons (Gupta and Verhoeven 2001). However, health resources are not the only input involved in the health production process.…”

Section: Datamentioning

confidence: 99%

Value efficiency analysis of health systems: does public financing play a role?

2010

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Aims/Background This study measures the performance of the health system in 165 countries and its relationship with public financing. Methods We use value efficiency analysis (VEA), a refinement of data envelopment analysis (DEA), to measure the efficiency of the health systems using data on healthy life expectancy and disability adjusted life years as health outcomes. Expenditure on health and education are used as inputs to the health system. Results The group of high income OECD countries shows the largest indexes of efficiency and also the lowest dispersion. In contrast, low income countries also have the most inefficient health systems, which implies that there are more opportunities for improvement. The average efficiency score is 0.96 for high income countries, 0.83 for upper-middle income countries, 0.86 for lower-middle income countries and only 0.76 for low income countries. Only 17 countries have a score equal to 1 and therefore are completely efficient and can be taken as referents. The index of efficiency is found to be positively associated with government expenditure on health as a percentage of total expenditure on health. ConclusionsThe analysis of the results shows that the public share in health expenditure and the weight of health expenditure in public budgets are two factors positively associated with the performance of the health systems. The study also highlights the advantages of using VEA over DEA in the measurement of performance.

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“…In Tanzi andSchuknecht (1997, 2000), the empirical application analyzes 18 developed and industrialized countries, combining public expenditures that should be able to provide a given set of socioeconomic indicators. In Gupta and Verhoeven (2001), non-parametric mathematical frameworks are used to model the efficiency of 37 African governments in education and health. Clements (2002) measures the efficiency of education in the European Union.…”

Section: Empirical Literature Reviewmentioning

confidence: 99%

Análise do impacto das fontes alternativas de financiamento na eficiência e na produtividade dos entes federativos subnacionais no Brasil após a Lei de Responsabilidade Fiscal

Matos

2017

Rev. Adm. Pública

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We use panel data envelopment analysis on a sample that aims to model the process of social welfare generation by federation units. The first innovation is the use of input sources associated with traditional revenues, such as transfers and taxes, as well as alternative sources of funding via national credit and paradiplomacy. As a result of this process, the State provides goods and services associated with socioeconomic variables such as, health, violence, demographics, study, and basic infrastructure. Only seven units, Bahia, Ceará, Maranhão, Minas Gerais, Pará, Paraná, and São Paulo, were entirely efficient in the decade studied (2004 to 2013). The incorporation of credit sources as inputs significantly influences efficiency gains and changes to national ranking. The level of efficiency of some states might be compromised by excessive debt. In terms of public policy, the use of efficiency as a meritocracy metric in tax reform is suggested. Keywords: efficiency and productivity; credit and paradiplomacy; federative subnational entities; social welfare; debt. Análise do impacto das fontes alternativas de financiamento na eficiência e na produtividade dos entes federativos subnacionais no Brasil após a Lei de Responsabilidade FiscalEste artigo faz uso da técnica de análise envoltória de dados em painel, para uma amostra balanceada com dados anuais de 2004 a 2013, visando modelar o processo de geração de bem-estar social por parte das unidades da federação. Uma primeira inovação está no uso de fontes de insumos associados às receitas tradicionais, como transferências e tributos, e de fontes alternativas de financiamento, via crédito nacional e via paradiplomacia. Como resultado desse processo, o Estado proporciona produtos e serviços associados a variáveis de natureza socioeconômica, de saúde, de violência, de demografia, de estudo e de infraestrutura básica. Apenas sete unidades foram plenamente eficientes na década em questão: Bahia, Ceará, Maranhão, Minas Gerais, Pará, Paraná e São Paulo. A incorporação das fontes de crédito com insumos aumenta a eficiência dos estados, alterando o ranking nacional. O nível de eficiência de alguns estados pode vir a ser comprometido pelo endividamento excessivo. Em termos de política pública, sugere-se o uso da eficiência como métrica de meritocracia na reforma tributária. Palavras-chave: eficiência e produtividade; crédito e paradiplomacia; entes federativos subnacionais; bem-estar social; endividamento. Análisis de impacto de otras fuentes de financiación en la eficiencia y productividad de las entidades federadas subnacionales en Brasil Después de la Ley de Responsabilidad FiscalEste artículo utiliza envolvente de datos panel de la técnica de análisis de una muestra equilibrada de los datos anuales de 2004 a 2013, con el objetivo de modelar el proceso de generación de bienestar social por las unidades de la federación. La primera innovación es el uso de fuentes de entradas asociadas con recetas tradicionales, como las transferencias y los impuestos, así como fuentes altern...

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The efficiency of government expenditure: experiences from Africa

Cited by 319 publications

References 16 publications

Public sector efficiency: An international comparison

Public sector efficiency: An international comparison

Value efficiency analysis of health systems: does public financing play a role?

Análise do impacto das fontes alternativas de financiamento na eficiência e na produtividade dos entes federativos subnacionais no Brasil após a Lei de Responsabilidade Fiscal

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