The Study of Fiscal Efficiency in Taiwan Local Government with the Characteristics of Spatial Dependence: Data Envelopment Analysis Approach

• Main Authors: Yung-Chi Chen, 陳勇吉
• Other Authors: Chun-Hung Lin
• Format: Others
• Language: zh-TW
• Published: 2013
• Online Access: http://ndltd.ncl.edu.tw/handle/vub4xz

碩士 === 淡江大學 === 產業經濟學系碩士班 === 101 === In considering the rising fiscal deficits in recent years in Taiwan, deterioration of fiscal expenditure would cause obstruction and instability to the development of the economy. Local governments'' fiscal efficiencies in Taiwan are different between North and South. While political partisanship and democratic development were highly developed in Taiwan, government expenditure is usually limited by the ruling camp. In order to understand the causes of these phenomena, this study discusses the relationship between the fiscal efficiency of Taiwan local government and the democratic system by considering the spatial spillover effects. Firstly, this paper evaluates 22 local governments'' fiscal efficiency in Taiwan over the period 1998-2006 with the Data Envelopment Analysis method (DEA) and Seiford and Zhu’s (2002) undesirable output model. The efficiency ranking is found differently by considering “undesirable output” from the local government’s expenditure. Secondly, the results show that local governments with higher efficiency concentrate in the northern regions of Taiwan, while the efficiency rankings would change due to the political party alternations in power. Finally, we use the Moran’s I test and first-order spatial model to indicate that local government’s fiscal efficiency has significantly positive cross-regional spillovers.