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Title: Efficiency of Local Government Spending: Evidence for the Lisbon Region
Author: Afonso, António
Fernandes, Sónia
Keywords: municipal expenditure
production possibility frontier
Issue Date: 2003
Publisher: ISEG – Departamento de Economia
Citation: Afonso, António e José Passos. 2003. "Efficiency of Local Government Spending: Evidence for the Lisbon Region". Instituto Superior de Economia e Gestão - DE Working papers nº 9-2003/DE/CISEP
Series/Report no.: DE Working papers;nº 9-2003/DE/CISEP
Abstract: In this paper we measure and analyse expenditure efficiency of Portuguese local governments using a non-parametric technique for production frontier estimation known as Free Disposal Hull. We first construct an index of municipal performance and then compute input and output efficiency scores for 51 Portuguese municipalities located in the region of Lisbon and Vale do Tejo (RLVT) in order to estimate the extent of municipal spending that seems to be "wasted" relative to the "best-practice" frontier. The results of our empirical analysis suggest that RLVT municipalities could achieve, on average, roughly the same level of local output with about 39 percent fewer resources, i.e. local performance could be improved without necessarily increasing municipal spending.
ISSN: 0874-4548
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Appears in Collections:DE - Documentos de trabalho / Working Papers
CISEP - Documentos de Trabalho / CISEP - Working Papers

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