TY  - JOUR
AB  - Purpose The purpose of this paper is to investigate whether Brazilian municipalities are losing efficiency when collecting local taxes in response to oil windfalls. In particular, the paper aims to analyze the hypothesis that these grants encourage the benefiting municipalities to collect taxes with excessive administrative costs.Design/methodology/approach The author estimate a stochastic cost frontier with fixed effects and investigate whether oil revenues impact on the efficiency scores.Findings The results reveal that the municipalities benefitting from oil revenues (royalties) reduce their efficiency in collecting taxes in response to such grants, which signals that they generate some type of X-inefficiency in municipal public management.Research limitations/implications The stochastic cost frontier requires the calculation of input prices for public sector.Originality/value Using a cost frontier, it is possible to avoid the problem of mixing technical efficiency with unobservable preferences on public goods, as well as to focus on economic efficiency instead of technical one.
VL  - 43
IS  - 5
SN  - 0144-3585
DO  - 10.1108/JES-02-2014-0036
UR  - https://doi.org/10.1108/JES-02-2014-0036
AU  - Postali Fernando Antonio Slaibe
PY  - 2016
Y1  - 2016/01/01
TI  - Oil windfalls and X-inefficiency: evidence from Brazil
T2  - Journal of Economic Studies
PB  - Emerald Group Publishing Limited
SP  - 699
EP  - 718
Y2  - 2024/04/19
ER  -