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Economies of scale and Brazilian local government expenditure

Evidence from the State of Paraná

Bibliographic Data

ID6302995
AuthorsLuan Vinicius Bernardelli (0000-0003-1410-2318, Universidade Estadual de Maringá), Michael A Kortt (0000-0002-3556-3001, Southern Cross University, corresponding author), Brian Dollery (0000-0003-2760-865X, UNE Business School, University of New England, Armidale, Australia)
Year2020
Volume46
Issue3
Pages436-458
Publication date2020-05-03
Open AccessNo
TypeARTICLE
VenueLocal Government Studies (JOURNAL)
Journal identifiersISSN: 0300-3930 • E-ISSN: 1743-9388
PublisherInforma UK Limited (PUBLISHER • GB)
DOI10.1080/03003930.2019.1635018
OpenAlexW2954191631
LanguageEN
Citations received8
References cited20

Controversy surrounds local government reform, particularly efforts directed at reducing the number of local authorities to secure economies of scale. We examine whether economies of scale exist in local government outlays by analysing the expenditure of 398 municipalities for the Brazilian state of Paraná using a 16-year panel dataset covering the period 2002–2017. We find evidence that municipal expenditure is characterised by substantial scale economies. However, given the strong correlation between population size and population density, it is important to ascertain whether the influence of population size on municipal expenditure is due to variations in population density or not. When local government areas are divided into sub-groups based on population density, evidence of scale economies remains with the majority of councils operating below optimal size. Municipal consolidations may thus lead to lower per capita expenditure

Demographic economics · Development economics · Econometrics · Economics · Economies of scale · Economy · Geography · Government (linguistics · Government Expenditure · Local government · Macroeconomics · Panel data · Per capita · Population · Population size · Public finance · Scale (ratio · State (computer science · Demography · Fiscal Policy and Economic Growth · Local Government Finance and Decentralization · Taxation and Compliance Studies

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Citations per year2.67
Citation span2023 - 2026 (4)
Highly citedNo

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