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1 – 10 of over 3000Sandra Matos, Susana Jorge and Patrícia Moura e Sá
This paper aims to propose a tool to assess local public expenditure effectiveness based on a framework of alignment between outputs, outcomes and impacts – the Index of Municipal…
Abstract
Purpose
This paper aims to propose a tool to assess local public expenditure effectiveness based on a framework of alignment between outputs, outcomes and impacts – the Index of Municipal Expenditure Effectiveness (IMEE). This index is composed of a set of indicators associated with the typology of local expenditure.
Design/methodology/approach
The paper describes the methodological approach used in the development of the Index, considering the insights from the literature review and the opinion of a panel of experts. The indicators of outcomes and social impacts that are part of the Index are intentionally aligned with the UN Sustainable Development Goals (SDGs) as they provide an essential guide to assess public value creation in the current context. For simplicity purposes, three main components of municipal expenditure were considered, namely Education, Essential Public Services and Local Public Transportation. The Index is then illustrated through a pilot application, using data from five Portuguese municipalities.
Findings
This study argues that measuring the public expenditure effectiveness based on outcome and impact indicators can provide the data needed for local governments to better understand the effects of their activities over time, ultimately assessing their contribution to public value.
Practical implications
Assessing the impact of local spending is important to ensure the best use of public resources. Linking local public expenditures with the 2030 Agenda and the SDGs is a promising avenue to understand up to what extent the application of the public money is contributing to create public value by impacting on citizens’ lives.
Originality/value
The proposed IMEE contributes to addressing a gap identified in public organizations, including local governments, regarding the lack of consideration of expenditure and outcome/impact relationships, and the use of variables to measure long term impacts.
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There is vast disparity in public expenditure on science, technology and environment (STE) across various Indian states. Public expenditure on STE is crucial in maintaining…
Abstract
Purpose
There is vast disparity in public expenditure on science, technology and environment (STE) across various Indian states. Public expenditure on STE is crucial in maintaining symmetric growth, social cohesion and sustainable development. Literature on this topic is scarce, which prompted the investigation of club convergence of STE public expenditure. In particular, the purpose of this paper to study the club convergence of STE public expenditure in the case of 20 Indian states during the period from 1987–1988 to 2019–2020.
Design/methodology/approach
This study applies the clustering algorithm to identify club convergence, advanced by the Phillips and Sul test, which enables identification of multiple steady states or club convergence, unlike beta and sigma convergences.
Findings
The findings of this paper show that all Indian states do not converge towards single steady states. This suggests a disparity in STE public expenditure across Indian states. Moreover, the findings favour three clubs that have their own unique transition paths. The results of this study are supported by the robustness check.
Practical implications
The findings suggest that the allocation of public expenditure on STE can be made based on club convergence to achieve social cohesion, sustainable development and millennium development goals across states.
Originality/value
Although several previous studies have investigated the convergence of public expenditure by considering either aggregate public expenditure or health/education expenditure, literature on the convergence hypothesis of STE public expenditure, particularly across Indian states, is scarce. Moreover, this paper is unique, as it examines multiple steady states or club convergence. Finally, this paper contributes to policymaking by suggesting which states should be given a push to achieve social cohesion and sustainable development.
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Nikolaos Grigorakis and Georgios Galyfianakis
The empirical analysis dealt in this paper emphasizes on the impact of military expenditures on out of pocket (OOP) healthcare payments. A sizeable body of defence economics…
Abstract
Purpose
The empirical analysis dealt in this paper emphasizes on the impact of military expenditures on out of pocket (OOP) healthcare payments. A sizeable body of defence economics literature has investigated the trade-off between military and public health expenditure, by testing the crowding-out or growth-stimulating hypothesis; does military expenditure scaling up crowd-out or promote governmental resources for social and welfare programs, including also state health financing?
Design/methodology/approach
In this study, panel data from 2000 to 2018 for 129 countries is used to examine the impact of military expenditure on OOP healthcare payments. The dataset of countries is categorized into four income-groups based on World Bank's income-group classification. Dynamic panel data methodology is applied to meet study objectives.
Findings
The findings of this study indicate that military expenditure positively affects OOP payments in all the selected groups of countries, strongly supporting in this way the crowding-out hypothesis whereby increased military expenditure reduces the public financing on health. Study econometric results are robust since different and alternative changes in specifications and samples are applied in our analysis.
Practical implications
Under the economic downturn backdrop for several economies in the previous decade and on the foreground of a potential limited governmental fiscal space related to the Covid-19 pandemic adverse economic effects, this study provides evidence that policy-makers have to adjust their government policy initiatives and prioritize Universal Health Coverage objectives. Consequently, the findings of this study reflect the necessity of governments as far as possible to moderate military expenditures and increase public financing on health in order to strengthen health care systems efficiency against households OOP spending for necessary healthcare utilization.
Originality/value
Despite the fact that a sizeable body of defence economics literature has extensively examined the impact of military spending on total and public health expenditures, nevertheless to the best of our knowledge there is no empirical evidence of any direct effect of national defence spending on the main private financing component of health systems globally; the OOP healthcare payments.
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Nitin Arora and Shubhendra Jit Talwar
The fiscal outlay efficiency matters when the performance-based allocation of funds is made to state governments by the central government in a federal structure of an economy…
Abstract
Purpose
The fiscal outlay efficiency matters when the performance-based allocation of funds is made to state governments by the central government in a federal structure of an economy like India. Also the efficiency cannon of public expenditure is a key aspect in the field of public economics. Thus, a study to evaluate the efficiency in fiscal outlay of Indian states has been conducted.
Design/methodology/approach
The paper offers a three divisions–based paradigm under Network Data Envelopment Analysis framework to compare the performance of fiscal entities (say Indian state governments) in converting available fiscal resources into desired short-run and long-run growth and development objectives. The network efficiency score has been taken as a measure of the quality of fiscal outlay management that is trifurcated into divisional efficiencies representing budgeting process, fiscal outlay efficiency process and fiscal outlay effectiveness process.
Findings
It has been noticed that the states are under performing in achieving short-run growth targets and so the efficiency process division has been identified a major source of fiscal under performance. Suboptimum allocation of fiscal expenditure under various heads within the fiscal resources, as explained under budgeting process, is another major cause of fiscal under performance.
Practical implications
The study purposes a three divisions–based paradigm that takes into account efficiency of a state in (1) planning budget, (2) achieving short-run growth targets and (3) achieving long-run development targets. These three stages are named as budgeting process efficiency, fiscal outlay efficiency and fiscal outlay effectiveness, respectively. Therefore, a new paradigm called BEE paradigm is proposed to evaluate performance of fiscal entities in terms of fiscal outlay efficiency.
Originality/value
In existing literature on measuring efficiency of public expenditure, the public sector outputs have been made as function of fiscal expenditure as input treating the said outlay as an exogenous variable. In present context, the fiscal expenditure has been treated endogenous to the budgeting process. A high inefficiency on account of budgeting process supports this treatment too.
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Afees Salisu and Douglason Godwin Omotor
This study forecasts the government expenditure components in Nigeria, including recurrent and capital expenditures for 2021 and 2022, based on data from 1981 to 2020.
Abstract
Purpose
This study forecasts the government expenditure components in Nigeria, including recurrent and capital expenditures for 2021 and 2022, based on data from 1981 to 2020.
Design/methodology/approach
The study employs statistical/econometric problems using the Feasible Quasi Generalized Least Squares approach. Expenditure forecasts involve three simulation scenarios: (1) do nothing where the economy follows its natural path; (2) an optimistic scenario, where the economy grows by specific percentages and (3) a pessimistic scenario that defines specific economic contractions.
Findings
The estimation model is informed by Wagner's law specifying a positive link between economic activities and public spending. Model estimation affirms the expected positive relationship and is relevant for generating forecasts. The out-of-sample results show that a higher proportion of the total government expenditure (7.6% in 2021 and 15.6% in 2022) is required to achieve a predefined growth target (5%).
Originality/value
This study offers empirical evidence that specifically requires Nigeria to invest a ratio of 3 to 1 or more in capital expenditure to recurrent expenditure for the economy to be guided on growth.
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Kaveh Moghaddam, Thomas Weber and Amirhossein Maleki
The institutional context and government policies may encourage or discourage entrepreneurship in a country. The main research question in this study is: how does a national…
Abstract
The institutional context and government policies may encourage or discourage entrepreneurship in a country. The main research question in this study is: how does a national social benefits system influence the entrepreneurial decision-making process to start a new venture across countries? The authors investigate two categories of effects: (1) the direct effects of public and private social expenditure on the entrepreneurial decision to start a new venture and (2) the multilevel interaction effects of social benefits and the individual-level ‘fear of failure to start a business’. The authors find that entrepreneurs in countries with a high level of public social expenditures are less likely to decide to start a new venture. The findings also suggest that private social expenditure weakens the negative effect of the ‘fear of failure’ on the entrepreneurial decision to start a new venture.
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Hacer Simay Karaalp-Orhan, Nurgül Evcim and Fatih Deyneli
The aim of this study is to analyze which socioeconomic factors (economic, demographic, and political) most commonly affect the social expenditure of the European Union (EU) and…
Abstract
Purpose
The aim of this study is to analyze which socioeconomic factors (economic, demographic, and political) most commonly affect the social expenditure of the European Union (EU) and Organization for Economic Co-operation and Development (OECD) countries.
Design/methodology/approach
A panel data fixed-effects model is employed for 34 OECD and 23 EU countries between 2000 and 2020.
Findings
Results indicate that, in all country groups, economic factors have the most significant influence on social expenditures, with income being the primary determinant, particularly in EU countries. The negative impacts of unemployment and inflation underscore the importance of counter-cyclical measures adopted by countries to maintain stability in their social expenditures. The most influential demographic factor is found as the old-age-dependency ratio. While the rule of law affects social expenditure positively, government effectiveness and female labor force participation affect it negatively. The positive effect of Konjunkturforschungsstelle (KOF) indexes shows the globalization effect, which can be attributable to the compensation hypothesis.
Practical implications
Governments enforce inclusive and sustainable policies to boost economic activities and GDP, thus combating inflation and unemployment and regulating the labor market and socioeconomic problems about aging populations and women’s economic participation to control social expenditures. The rule of law and institutional quality will also boost economic growth.
Originality/value
This study focuses on the effects of social expenditures in a broader view within the framework of the three main factors (economic, demographic, political) and attempts to determine the key factors that account for the differences in social expenditure between the OECD and EU countries.
Peer review
The peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-05-2023-0384
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The unsustainable public debt of most African economies adversely affects their economic growth and stability. This study aims to explore the influence of cross-country indicators…
Abstract
Purpose
The unsustainable public debt of most African economies adversely affects their economic growth and stability. This study aims to explore the influence of cross-country indicators of governance from African countries on public debt accumulation.
Design/methodology/approach
The study deployed a quantitative research design technique. Secondary data was used in this study. The frequency of the data is annual, and it is available from 1996 to 2022 for 48 countries in Africa. The study deployed the system generalized method of moments for the estimation.
Findings
The study finds that countries with high regulatory quality standards, control corruption and ensure effective governance accumulate less government debt while countries that abide by the rule of law instead accumulate more government debt. The study also finds that economic growth and government revenue reduce government gross debt while government expenditure and investments increase public debt.
Research limitations/implications
Due to data unavailability, other factors which are likely to influence government debt accumulation were not included in the study as control variables. This is the limitation of the study.
Social implications
African governments should strive to maintain high regulatory quality standards through the formulation and implementation of sound policies and regulations that permit and promote private sector development, and ensure quality and accountability of public and civil services. Governments are also urged to control corruption and enact good laws so that the enforcement of these laws will not worsen the risk of becoming debt-distressed.
Originality/value
Recent studies on governance and public debt were focused on the Arabian Gulf countries, countries of the Middle East and North Africa (MENA) region and a combination of high and low-income countries. This study scrutinizes exclusively the effects of the quality of governance indicators on public debt accumulation, in the context of Africa.
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Martins Iyoboyi, Latifah Musa-Pedro, Okereke Samuel Felix and Hussaina Sanusi
This paper examines the impact of fiscal constraints on education expenditure in Nigeria from 1981 to 2021, using annual time series data.
Abstract
Purpose
This paper examines the impact of fiscal constraints on education expenditure in Nigeria from 1981 to 2021, using annual time series data.
Design/methodology/approach
The study deployed cointegration techniques with structural breaks.
Findings
Cointegration was found between education expenditure, debt servicing (a proxy for fiscal constraint) and associated variables. In both the long and short run, debt servicing negatively and significantly impacts education expenditure. While government revenue has a positive and significant impact on education expenditure in the long and short run, political institution has a negative and significant impact in the long run. Political institution is thus critical to education financing in Nigeria. The impact of debt is positive and significant in the short run, but not significant in the long run. There is a unidirectional causality from debt servicing to education expenditure.
Practical implications
Political institutions are critical towards contracting only productive debts and checkmating the adverse political environment through political will that prioritizes education financing.
Originality/value
The study extends the empirical literature on the fiscal constraint-education expenditure first by investigating fiscal constraint-education expenditure nexus given the institutional environment, and second by extending the methodology using cointegration techniques in the midst of structural breaks.
Peer review
The peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-10-2022-0682.
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Ruben Bostyn, Laurens Cherchye, Bram De Rock and Frederic Vermeulen
We make use of rich microdata from the Belgian MEqIn survey, which contains detailed information on individual consumption, public consumption inside households, and time use. We…
Abstract
We make use of rich microdata from the Belgian MEqIn survey, which contains detailed information on individual consumption, public consumption inside households, and time use. We explain the observed household behavior by means of a collective model that integrates marriage market restrictions on intrahousehold allocation patterns. We adopt a revealed preference approach that abstains from any functional form assumptions on individual utility functions or intrahousehold decision processes. This allows us to (set) identify the sharing rule, which governs the intrahousehold sharing of time and money, and to quantify economies of scale within households. We use these results to conduct a robust individual welfare and inequality analysis, hereby highlighting the important role of detailed consumption and time use data.
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