Resumen
We study the role of natural resource windfalls in explaining the technical efficiency of public expenditure. Using a rich dataset of expenditure and public good provision for 1836 municipalities in Peru for the period 2001–2010, we estimate a nonmonotonic relationship between the efficiency of public good provision and the level of natural resource transfers. Local governments that were extremely favored by the boom in mineral prices were more efficient in using fiscal windfalls, whereas those that only benefited from modest transfers were more inefficient. These results can be explained by the increase in political competition associated with the boom. However, the fact that increases in efficiency were related to reductions in public good provision casts doubts on the beneficial effects of political competition in promoting efficiency.
Idioma original | Inglés |
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Páginas (desde-hasta) | 28-64 |
Número de páginas | 37 |
Publicación | Economics and Politics |
Volumen | 35 |
N.º | 1 |
DOI | |
Estado | Publicada - mar. 2023 |
Nota bibliográfica
Funding Information:We would like to thank the Editor and two anonymous referees for their comments and suggestions.
Publisher Copyright:
© 2022 John Wiley & Sons Ltd.