Essays in local public finance : how to measure and stimulate local government efficiency

This thesis is concerned with the measurement and determinants of efficiency of local governments in the provision of public goods and services. In particular, the three chapters provide new contributions to the literature of fiscal federalism studying, from different angles, the relationship between policies that can stimulate the electoral accountability of politicians and local government efficiency in the provision of public services. In all chapters the measurement of local government efficiency has been obtained through data envelopment analysis and stochastic frontier models using different measures of inputs and outputs employed in the production of public services. Subsequently, the determinants of efficiency have been studied using panel data models and quasi-experimental methods. The analysis takes advantage of the policies implemented by the Italian and the United Kingdom (UK) government in the last 20 years. In particular, Italian local authorities have been subject to an intense process of fiscal decentralisation, and English councils have been subject to a unique process of performance evaluation based on quantitative measures of outputs