A CROSS-COUNTRY ANALYSIS OF PUBLIC SECTOR INTERVENTIONS' EFFICIENCY
In this study, the authors aim is to measure public sector efficiency and to evaluate the efficiency of public sector economic interventions. They use the rule of law & bureaucratic quality, allocation, economic stability, economic growth and income distribution as outputs; public expenditure and regulation as inputs. They compute public sector efficiency scores by using a non-parametric, relative efficiency measurement technique, Data Envelopment Analysis (DEA), for 51 counties between 1995 and 2000. The study finds that overall public sector efficiency increases from 1995 to 2000 and there is a positive relationship between the efficiency of public sector and the level of economic development. Furthermore, the authors also find that a negative relationship between public sector intervention and the efficiency scores. Finally, it is found that the regulation tool is wasted in comparison with the expenditure tool.
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