Public Sector Efficiency: Evidence for New EU Member States and Emerging Markets

Afonso, António; Schuknecht, Ludger; Tanzi, Vito

doi:10.2139/ssrn.876945

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Public Sector Efficiency: Evidence for New EU Member States and Emerging Markets

ECB Working Paper No. 581

52 Pages Posted: 2 Feb 2006

See all articles by António Afonso

António Afonso

ISEG Lisbon School of Economics and Management,Universidade de Lisboa; UECE (Research Unit on Complexity and Economics); REM - Research in Economics and Mathematics

Vito Tanzi

Inter-American Development Bank (IADB)

There are 2 versions of this paper

Date Written: January 2006

Abstract

In this paper we analyse public sector efficiency in the new member states of the European Union compared to that in emerging markets. After a conceptual discussion of expenditure efficiency measurement issues, we compute efficiency scores and rankings by applying a range of measurement techniques. The study finds that expenditure efficiency across new EU member states is rather diverse especially as compared to the group of top performing emerging markets in Asia. Econometric analysis shows that higher income, civil service competence and education levels as well as the security of property rights seem to facilitate the prevention of inefficiencies in the public sector.

Keywords: government expenditure, efficiency, DEA, new EU member states, emerging markets

JEL Classification: C14, H40, H50

Suggested Citation: Suggested Citation

Afonso, António and Schuknecht, Ludger and Tanzi, Vito, Public Sector Efficiency: Evidence for New EU Member States and Emerging Markets (January 2006). ECB Working Paper No. 581, Available at SSRN: https://ssrn.com/abstract=876945 or http://dx.doi.org/10.2139/ssrn.876945