Evaluating efficient public good provision: Theory and evidence from a generalised conditional efficiency model for public libraries

Kristof De Witte*, Benny Geys

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

63 Citations (Web of Science)

Abstract

Provision of most public goods (e.g., health care, libraries, education, police, fire protection, utilities) can be characterized by a two-stage production process. In the first-stage, basic inputs (e.g., labor and capital) are used to generate service potential (e.g., opening hours, materials), which is then, in the second-stage, transformed into observed outputs (e.g., school outcomes, library circulation, crimes solved). As final outputs are also affected by demand-side factors, conflating both production stages likely leads to biased inferences about public productive (in)efficiency and its determinants. Hence, this paper uses a specially tailored, fully non-parametric efficiency model allowing for both outlying observations and heterogeneity to analyse efficient public good provision in stage one only. We thereby employ a dataset comprising all 290 flemish public libraries. Our findings suggest that ideological stance of the local government, wealth and density of the local population and source of library funding (i.e., local funding versus intergovernmental transfers) strongly affect library productive efficiency.
Original languageEnglish
Pages (from-to)319-327
JournalJournal of Urban Economics
Volume69
Issue number3
DOIs
Publication statusPublished - May 2011

Keywords

  • Public good provision
  • Conditional efficiency
  • Nonparametric estimation
  • Libraries
  • Local government

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