A Cross-Country Analysis of Public Sector Interventions’ Efficiency
A Cross-Country Analysis of Public Sector Interventions’ Efficiency

Summary/Abstract: In this study, our aim is to measure public sector efficiency and to evaluate the efficiency of public sector economic interventions. We use the rule of law & bureaucratic quality, allocation, economic stability, economic growth and in-come distribution as outputs; public expenditure and regulation as inputs. In the study, we 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 sec-tor 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, we 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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