Analisis de la eficiencia del gasto municipal y de sus determinantes

Pedro Herrera Catalan () and Pedro Francke Ballve ()
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Pedro Francke Ballve: Pontificia Universidad Católica del Perú - Departamento de economía

Revista Economía, 2009, issue 63, 113-178

Abstract: In this study we analyzed the efficiency of the spending of 1686 Peruvian municipalities for the year 2003 through the evaluation to the municipal public activities as a process of production which transforms inputs in outputs (Bradford et al. 1969 and Fisher 1996). In doing so, we established several ?best-practice? production frontiers in order to estimate the extent of municipal spending that seems to be wasted relative to that frontier. Five methodologies for the production frontier estimations were used (i) three non parametric: (i) Free Disposal Hull (FDH) and Data Envelopment Analysis (DEA-CRS and DEA-VRS) and (ii) two parametric: one deterministic and the other stochastic, which were estimated through ten categories of municipalities (four groups of provincial and six of district municipalities) defined through a cluster methodology. Finally, using TOBIT regression models, we analyzed the fiscal, socioeconomics and demographic determinants of the efficiency levels. We found different levels of efficiency and although we identified some good practices, the result at the national level is matter of concern because the same results could have been obtained with 57.6% less resources. Among the main determinants of this inefficiency spending the FONCOMUN and canon transfers were found, mainly at the district municipal level. One of the factors that allowed for a more efficient provision of local services was the civil participation, represented in the study by the Local Coordination Council. The results of the study show that there is a need to make more efforts to improve the local government spending. Even more so, after the promulgation of the Supreme Decree 068-2006-PCM in October 2006, by virtue of which the culmination of the competences and function transfers process, initially programmed for 2006-2010, brought forward to the end of 2007.

Keywords: municipal expense; performance of local governments; efficiency; borders of possibilities of production parametrics and not parametrics. (search for similar items in EconPapers)
Date: 2009
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Working Paper: Análisis de la eficiencia del gasto municipal y de sus determinantes (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:pcp:pucrev:y:2009:i:63:p:113-178

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