PUBLIC SECTOR EFFICIENCY: THE ROLES OF POLITICAL
AND BUDGETARY INSTITUTIONS, FISCAL CAPACITY AND DEMOCRATIC PARTICIPATION.
Lars-Erik Borge, Torberg Falch andPer Tovmo
The purpose of this paper is to investigate whether efficiency in
provision is affected by political and budgetary institutions, fiscal
democratic participation. In order to address this issue we take advantage
of a new global efficiency measure for Norwegian local governments. There
is strong evidence that high fiscal capacity and a high degree of party
fragmentation contributes to low efficiency. In addition we find that
increased democratic participation tends to increase efficiency, while
a centralized top down budgetary process is associated with low efficiency.