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Declared vs. revealed yardstick competition:Local government efficiency in Norway

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This paper investigates whether the production efficiency of Norwegian local governments exhibits a spatial pattern that is compatible with the hy­pothesis of yardstick competition. In order to check whether yardstick com­petition is really responsible far the observed spatial pattern, and to rule out alternative theoretical explanations, the paper exploits unique information from a survey on Norwegian local governments, where local public officials are explicitly asked whether they compare their own performances in the provision of public services to those of other governments (benchmarking). Merging the latter information - "declared" yardstick competition - with the observed interdependence in local efficiency measures - "revealed" yardstick competition - the paper provides evidence that comparative performance evaluation generates spatial auto-correlation in local efficiency indicators.

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  • Revelli Federico & Tovmo Per, 2006. "Declared vs. revealed yardstick competition:Local government efficiency in Norway," Department of Economics and Statistics Cognetti de Martiis. Working Papers 200605, University of Turin.
    • Handle: RePEc:uto:dipeco:200605
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