IDEAS home Printed from https://ideas.repec.org/a/sae/urbstu/v51y2014i13p2899-2915.html
   My bibliography  Save this article

Administrative scale economies in local government: An empirical analysis of Sabah municipalities, 2000 to 2009

Author

Listed:
  • Siew King Ting

    (Universiti Teknologi MARA, Malaysia)

  • Brian Dollery

    (University of New England, Australia)

  • Rene Villano

    (University of New England, Australia)

Abstract

Municipal corporate centres not only perform multiple administrative functions, including supervision, monitoring and budgeting of the overall operation of local government, but also absorb significant resources. From a public policy perspective, it is thus important to determine whether administrative scale economies exist. Adopting an econometric approach, this paper investigates administrative scale effects and the determinants of administrative intensity at the corporate level for 22 local authorities in the Malaysian state of Sabah from 2000 to 2009. Our results indicate that there is an inverted U-shaped scale effect for staff size on administrative intensity in the small urban sample, while own-source revenue is the most important factor in determining administrative intensity in all local authorities and big urban samples. Several policy recommendations are proposed.

Suggested Citation

  • Siew King Ting & Brian Dollery & Rene Villano, 2014. "Administrative scale economies in local government: An empirical analysis of Sabah municipalities, 2000 to 2009," Urban Studies, Urban Studies Journal Limited, vol. 51(13), pages 2899-2915, October.
    • Handle: RePEc:sae:urbstu:v:51:y:2014:i:13:p:2899-2915
    DOI: 10.1177/0042098013512873
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0042098013512873
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0042098013512873?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Jorid Kalseth & Jørn Rattsø, 1998. "Spending and Overspending in Local Government Administration: A Minimum Requirement Approach Applied to Norway," Chapters, in: Jørn Rattsø (ed.), Fiscal Federalism and State–local Finance, chapter 19, pages 339-351, Edward Elgar Publishing.
    2. Blane Lewis, 2006. "Local government taxation: An analysis of administrative cost inefficiency," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 42(2), pages 213-233.
    3. Michael Chisholm, 2004. "Reorganizing Two-Tier Local Government for Regional Assemblies," Public Money & Management, Taylor & Francis Journals, vol. 24(2), pages 113-120, April.
    4. Serge Garcia & Alban Thomas, 2001. "The Structure of Municipal Water Supply Costs: Application to a Panel of French Local Communities," Journal of Productivity Analysis, Springer, vol. 16(1), pages 5-29, July.
    5. Transparency International TI, 2012. "Corruption Perceptions Index 2012," Working Papers id:5186, eSocialSciences.
    6. Seymour Melman, 1951. "The Rise Of Administrative Overhead In The Manufacturing Industries Of The United States 1899–1947," Oxford Economic Papers, Oxford University Press, vol. 3(1), pages 62-112.
    7. Tyrefors Hinnerich, Björn, 2009. "Do merging local governments free ride on their counterparts when facing boundary reform?," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 721-728, June.
    8. Brian E. Dollery & Joseph Garcea & Edward C. LeSage Jr (ed.), 2008. "Local Government Reform," Books, Edward Elgar Publishing, number 12592.
    9. Niklas Hanes & Magnus Wikstrom, 2008. "Does the Local Government Structure Affect Population and Income Growth? An Empirical Analysis of the 1952 Municipal Reform in Sweden," Regional Studies, Taylor & Francis Journals, vol. 42(4), pages 593-604.
    10. Jorid Kalseth & Jørn Rattsø, 1998. "Political Control of Administrative Spending: The Case of Local Governments in Norway," Chapters, in: Jørn Rattsø (ed.), Fiscal Federalism and State–local Finance, chapter 11, pages 181-201, Edward Elgar Publishing.
    11. Mehdi Farsi & Massimo Filippini, 2004. "An Empirical Analysis of Cost Efficiency in Non‐profit and Public Nursing Homes," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 75(3), pages 339-365, September.
    12. Mehdi Farsi & Massimo Filippini & Michael Kuenzle, 2005. "Unobserved heterogeneity in stochastic cost frontier models: an application to Swiss nursing homes," Applied Economics, Taylor & Francis Journals, vol. 37(18), pages 2127-2141.
    13. Habibullah, M.S. & Dayang-Afizzah, A.M., 2008. "Borders and economic growth: The case of Sabah and her neighbours," MPRA Paper 12104, University Library of Munich, Germany.
    14. Brian E. Dollery & Lorenzo Robotti (ed.), 2008. "The Theory and Practice of Local Government Reform," Books, Edward Elgar Publishing, number 12719.
    15. Shoko Haneda & Akihiro Hashimoto & Takao Tsuneyoshi, 2012. "Evaluating Administrative Efficiency Change in the Post-Merger Period," International Regional Science Review, , vol. 35(2), pages 237-262, April.
    16. Peter Ward & James Storbeck & Stephen Mangum & Patricia Byrnes, 1997. "An analysis of staffing efficiency in U.S. manufacturing: 1983 and 1989," Annals of Operations Research, Springer, vol. 73(0), pages 67-89, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Caillan Fellows & Brian Dollery & Carolyn‐Thi Thanh Dung Tran, 2022. "Is Bigger More Efficient? An Empirical Analysis of Scale Economies in Administration in South Australian Local Government," Economic Papers, The Economic Society of Australia, vol. 41(1), pages 54-67, March.
    2. Luan V. Bernardelli & Brian E. Dollery & Michael A. Kortt, 2021. "An Empirical Analysis of Scale Economies in Administrative Intensity in the Paraná State Local Government System in Brazil," Sustainability, MDPI, vol. 13(2), pages 1-13, January.
    3. Carolyn‐Thi Thanh Dung Tran & Brian Dollery & Subba Reddy Yarram, 2023. "The Influence of Administrative Intensity on Efficiency: An Empirical Analysis of Australian Universities," Economic Papers, The Economic Society of Australia, vol. 42(3), pages 282-305, September.
    4. Gerard Turley & John McDonagh & Stephen McNena & Arkadiusz Grzedzinski, 2018. "Optimum Territorial Reforms in Local Government: An Empirical Analysis of Scale Economies in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 49(4), pages 463-488.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hanes, Niklas, 2003. "Empirical Studies in Local Public Finance: Spillovers, Amalgamations, and Tactical Redistribution," Umeå Economic Studies 604, Umeå University, Department of Economics.
    2. Giovanna Di Ielsi & Fabio Fiorillo & Francesco Porcelli, 2022. "Le unioni di comuni in Italia: modelli di gestione associata a confronto (The Italian "unioni di comuni": A comparison among different management models of intermunicipal cooperation)," Moneta e Credito, Economia civile, vol. 75(297), pages 11-40.
    3. Rhys Andrews, 2015. "Vertical consolidation and financial sustainability: evidence from English local government," Environment and Planning C, , vol. 33(6), pages 1518-1545, December.
    4. Caillan Fellows & Brian Dollery & Carolyn‐Thi Thanh Dung Tran, 2022. "Is Bigger More Efficient? An Empirical Analysis of Scale Economies in Administration in South Australian Local Government," Economic Papers, The Economic Society of Australia, vol. 41(1), pages 54-67, March.
    5. David Bartolini, 2015. "Municipal fragmentation and economic performance in OECD TL2 regions," ERSA conference papers ersa15p607, European Regional Science Association.
    6. Brian Dollery & Michael Kortt & Bligh Grant, 2013. "Options for rationalizing local government structure: a policy agenda," Chapters, in: Santiago Lago-Peñas & Jorge Martinez-Vazquez (ed.), The Challenge of Local Government Size, chapter 10, pages 242-262, Edward Elgar Publishing.
    7. Jean-Michel Josselin & Fabio Padovano & Yvon Rocaboy, 2013. "Grant legislation vs. political factors as determinants of soft budget spending behaviors. Comparison between Italian and French regions," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 10(3), pages 317-354, December.
    8. Benoît Le Maux & Kristýna Dostálová & Fabio Padovano, 2020. "Ideology or voters? A quasi-experimental test of why left-wing governments spend more," Public Choice, Springer, vol. 182(1), pages 17-48, January.
    9. Bernard Dafflon, 2012. "Voluntary amalgamation of local governments: the Swiss debate in the European context," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1204, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    10. Banaszewska, Monika & Bischoff, Ivo & Bode, Eva & Chodakowska, Aneta, 2022. "Does inter-municipal cooperation help improve local economic performance? – Evidence from Poland," Regional Science and Urban Economics, Elsevier, vol. 92(C).
    11. Björn Kauder, 2016. "Incorporation of municipalities and population growth: A propensity score matching approach," Papers in Regional Science, Wiley Blackwell, vol. 95(3), pages 539-554, August.
    12. Juan Luis Gómez-Reino & Santiago Lago-Peñas & Jorge Martinez-Vazquez, 2021. "Evidence on economies of scale in local public service provision: a meta-analysis," Working Papers. Collection A: Public economics, governance and decentralization 2103, Universidade de Vigo, GEN - Governance and Economics research Network.
    13. Fabio FIORILLO, 2011. "A model on interests representation and;accountability in small local governments," Working Papers 356, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    14. Alice Tran & Kim-Huong Nguyen & Len Gray & Tracy Comans, 2019. "A Systematic Literature Review of Efficiency Measurement in Nursing Homes," IJERPH, MDPI, vol. 16(12), pages 1-18, June.
    15. Iparraguirre, José Luis & Ma, Ruosi, 2015. "Efficiency in the provision of social care for older people. A three-stage Data Envelopment Analysis using self-reported quality of life," Socio-Economic Planning Sciences, Elsevier, vol. 49(C), pages 33-46.
    16. Mehdi Farsi & Massimo Filippini, 2008. "Effects of ownership, subsidization and teaching activities on hospital costs in Switzerland," Health Economics, John Wiley & Sons, Ltd., vol. 17(3), pages 335-350, March.
    17. Dollery, B.E., 2021. "A critical appraisal of the Western Australian local government review panel’s recommendations," Economic Analysis and Policy, Elsevier, vol. 71(C), pages 434-438.
    18. Juan Luis Gómez-Reino & Jorge Martinez-Vazquez, 2013. "An international perspective on the determinants of local government fragmentation," Chapters, in: Santiago Lago-Peñas & Jorge Martinez-Vazquez (ed.), The Challenge of Local Government Size, chapter 2, pages 8-54, Edward Elgar Publishing.
    19. Luan V. Bernardelli & Brian E. Dollery & Michael A. Kortt, 2021. "An Empirical Analysis of Scale Economies in Administrative Intensity in the Paraná State Local Government System in Brazil," Sustainability, MDPI, vol. 13(2), pages 1-13, January.
    20. Mehdi Farsi & Massimo Filippini & Diego Lunati, 2008. "Economies of Scale and Efficiency Measurement in Switzerland's Nursing Homes," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 144(III), pages 359-378, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:urbstu:v:51:y:2014:i:13:p:2899-2915. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: http://www.gla.ac.uk/departments/urbanstudiesjournal .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.