Work detail

The Efficiency of Public Expenditure, Evidence from the Czech Republic

Author: Mgr. Veronika Vraná
Year: 2016 - summer
Leaders: PhDr. Jan Zápal Ph.D.
Work type: Economic Theory
Language: English
Pages: 87
Awards and prizes:
Abstract: Efficiency is an important concept for performance evaluation of decisionmaking
units. This thesis studies efficiency of public spending and methods
of its estimation. Firstly, a wide range of efficiency estimators are defined and
compared. For the public spending efficiency analysis the most convenient estimator
is found to be the cost frontier approach of the Stochastic Frontier
Analysis (SFA).
The second part of the thesis contains efficiency analysis of public spending
in the 14 regions of the Czech Republic in the years 2003–2014. For the analysis
current expenditure of regional offices is used as the input. Based on the
investigation of regional services output index is formed and employed in the
analysis. The estimation is performed using the cost frontier approach of the
SFA as the main method. Various other efficiency estimators are then applied
to the data in order to study robustness of the results. The thesis further
discusses relative ranking of the regions and time evolution of efficiency scores
using different assumptions and variety of methods. Lastly, several potential
effects on the estimated efficiency are considered and analysed.




Patria Finance
Česká Spořitelna