The Determinants and Efficiency of Local Authority Spending in England

January 1, 1991

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper analyzes the efficiency and determinants of local authority expenditure in England during 1989/90. The capitalization of local spending in house prices is used as a test of efficiency, and it is found that local services are in general excessive from this standpoint. The determinants of local government spending are then estimated and local incomes, the tax price faced by the electorate, and local party control are found to be significant. Application of the analysis to the recently introduced local government reforms suggest small effects on the overall level of spending.

Subject: Expenditure, Housing, Housing prices, Income, Labor, National accounts, Prices

Keywords: authorities rise, benefit principle, government grant, Housing, Housing prices, Income, local authority expenditure, local government, property tax, spending authorities, tax price, thatcher government, United Kingdom government, WP

Pages:
34
Volume:
1991
DOI:
https://doi.org/10.5089/9781451927108.001
Issue:
009
Series:
Working Paper No. 1991/009
Stock No:
WPIEA0091991
ISBN:
9781451927108
ISSN:
1018-5941

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