Improvement of Government Financing through Non-Conventional Methods: Reducing the Administrative Costs in the Public Sector

Abstract

The paper aims to emphasize the relative recent preoccupations of several European states and even of EU about reducing the administrative costs and contribution of this process to local and national development, increasing the GDP etc.

Recent appreciations of the European officials reveal estimations that a reduction by 25% of the administrative costs could lead to an increase of GDP by 2-3%.

Mechanisms of coordination for national policies are already operational even if their results are not yet visible.

Oriented mainly towards the private sector, the issue of reducing the administrative costs remains up-to-date also in the public sector. Moreover, even in the context of the current economic crisis, the reduction of the administrative costs represents an important resource for financing the development of the public sector at local level and the macro-economic policies.

Therefore, in this context, the paper comprises:

-Synthetic and comparative analyses about the content and results of the national policies for reducing the administrative costs. -Considerations concerning the enlargement of the mentioned policies on the economic and social processes specific for the public sector. -Models to evaluate the impact of reducing the administrative costs on financing the public sector, based on input-output analysis materialised through the production function. -Emphasizing the effects on long term of reducing the administrative costs and substantiating the policies for financing national or local governance.

Keywords: administrative costs, EU policies and programs, public sector

JEL Classification: H53, H72, G28