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Evaluation of Efficiency in Selected Areas of Public Services in European Union Countries

Martina Halaskova (), Renata Halaskova () and Viktor Prokop ()
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Martina Halaskova: Faculty of Economics, VŠB-Technical University of Ostrava, Sokolská třída 33, 702 00 Ostrava, Czech Republic
Renata Halaskova: Faculty of Education, University of Ostrava, Fráni Šrámka 3, 709 00 Ostrava, Czech Republic
Viktor Prokop: Faculty of Economics and Administration, University of Pardubice, Studentska 84, 532 10 Pardubice, Czech Republic

Sustainability, 2018, vol. 10, issue 12, 1-17

Abstract: Over the past 40 years, the service sector has become the dominant area of market economies. The public sector and services financed from public financing represent a specific group within the services sector. This paper aims to evaluate the efficiency of EU countries and find the extent to which the volume of public services (and the respective financial allocations) can have an impact on selected economic indicators. To this end, the efficiency of public expenditure in five areas of public services (general public services; health; education; social protection; and recreation, culture, and religion) in 2009 and 2016 was evaluated in relation to selected economic indicators (GDP per capita and employment in services). In addition, the efficiency of public expenditure in EU countries was evaluated in relation to the size of the public sector and traditions of public administration. For cross-country analyses within the 27 European countries, data envelopment analysis and the input-oriented variable returns to scale (VRS) model were applied. The results demonstrated that in 2009, 13 out of 27 countries were efficient as opposed to 2016, where only seven countries were efficient. In countries with bigger size of public sector, the efficiency of public expenditure on services was not established. However, there was a similarity in the efficiency of public expenditure on services between groups of EU countries regarding the tradition of public administration.

Keywords: public services; public expenditure; efficiency; data envelopment analysis; EU countries; economic indicators (search for similar items in EconPapers)
JEL-codes: Q Q0 Q2 Q3 Q5 Q56 O13 (search for similar items in EconPapers)
Date: 2018
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