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On the Cost-Efficiency of Service Delivery in Small Municipalities

Author

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  • Francisco J. Arcelus
  • Pablo Arocena
  • Ferm�n Cabas�s
  • Pedro Pascual

Abstract

Arcelus F. J., Arocena P., Cabas�s F. and Pascual P . On the cost-efficiency of service delivery in small municipalities, Regional Studies . This paper analyses the determinants of the efficiency of local government spending. To that effect, a stochastic cost frontier is estimated on a sample of 260 small municipalities from Navarre, a region located in northern Spain. The results suggest that the cost-efficiency in the provision of municipal services increases with (1) the level of pooling or joint provision of services among municipalities; (2) the saliency of local taxes, as compared with regional grants, in its operating budget; (3) the presence of external public comptrollers; and (4) the magnitude of the municipality's accumulated past investment in infrastructures.

Suggested Citation

  • Francisco J. Arcelus & Pablo Arocena & Ferm�n Cabas�s & Pedro Pascual, 2015. "On the Cost-Efficiency of Service Delivery in Small Municipalities," Regional Studies, Taylor & Francis Journals, vol. 49(9), pages 1469-1480, September.
    • Handle: RePEc:taf:regstd:v:49:y:2015:i:9:p:1469-1480
    DOI: 10.1080/00343404.2013.837872
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    References listed on IDEAS

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    1. Lorenzo Boetti & Massimiliano Piacenza & Gilberto Turati, 2012. "Decentralization and Local Governments' Performance: How Does Fiscal Autonomy Affect Spending Efficiency?," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 68(3), pages 269-302, September.
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    Cited by:

    1. D’Inverno, Giovanna & De Witte, Kristof, 2020. "Service level provision in municipalities: A flexible directional distance composite indicator," European Journal of Operational Research, Elsevier, vol. 286(3), pages 1129-1141.
    2. Tommaso Agasisti & Francesco Porcelli, 2019. "Local governments’ efficiency and its heterogeneity – empirical evidence from a Stochastic Frontier Analysis of Italian municipalities 2010-2015," Working papers 81, Società Italiana di Economia Pubblica.
    3. Titl, Vitezslav & De Witte, Kristof & Geys, Benny, 2021. "Political donations, public procurement and government efficiency," World Development, Elsevier, vol. 148(C).
    4. Fusco, Elisa & Allegrini, Veronica, 2020. "The role of spatial interdependence in local government cost efficiency: An application to waste Italian sector," Socio-Economic Planning Sciences, Elsevier, vol. 69(C).
    5. Isabel Narbón-Perpiñá & Maria Teresa Balaguer-Coll & Diego Prior & Emili Tortosa-Ausina, 2021. "Searching for the optimal territorial structure: the case of Spanish provincial councils," Regional Studies, Taylor & Francis Journals, vol. 55(4), pages 645-664, April.
    6. Salazar-Adams, Alejandro & Ramirez-Figueroa, Cecilia, 2024. "Organization, capital, and human resource factors influencing waste collection efficiency in Mexico," Utilities Policy, Elsevier, vol. 88(C).
    7. Arocena, Pablo & Cabasés, Fermín & Pascual, Pedro, 2022. "A centralized directional distance model for efficient and horizontally equitable grants allocation to local governments," Socio-Economic Planning Sciences, Elsevier, vol. 81(C).
    8. Giampaolo Arachi & Debora Assisi & Berardino Cesi & Michele G. Giuranno & Felice Russo, 2022. "Inter-municipal Cooperation in Public Procurement," CEIS Research Paper 548, Tor Vergata University, CEIS, revised 19 Dec 2022.
    9. Isabel Narbón-Perpiñá & Kristof De Witte, 2016. "Local governments’ efficiency: A systematic literature review – Part I," Working Papers 2016/20, Economics Department, Universitat Jaume I, Castellón (Spain).
    10. Viktorija ipilova & Inta Ostrovska & Ludmila Aleksejeva & Elita Jermolajeva & Dmitrijs Olehnovics, 2017. "A Review of the Literature on Smart Development: Lessons for Small Municipalities," International Journal of Economics and Financial Issues, Econjournals, vol. 7(1), pages 460-469.
    11. Francesco Aiello & Graziella Bonanno & Luigi Capristo, 2017. "Explaining Differences In Efficiency: The Case Of Local Government Literature," Working Papers 201704, Università della Calabria, Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF.
    12. Francesco Aiello & Graziella Bonanno, 2019. "Explaining Differences In Efficiency: A Meta‐Study On Local Government Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 33(3), pages 999-1027, July.
    13. Maria Basílio & Clara Pires & Carlos Borralho & José Pires Reis, 2020. "Local government efficiency: is there anything new after Troika’s intervention in Portugal?," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 10(2), pages 309-332, June.

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