The Efficiency of Local Public Authorities in the Republic of Moldova: Importance and Determining Factors
Automatically translated summary. The full text is available in Romanian.
This study estimates the technical efficiency of all town halls in the Republic of Moldova, identifies the factors that influence it and examines what efficiency means for local development. Its findings point to an urgent need for systemic reforms in the organisation and functioning of local public authorities.
Econometric simulations show that the current transfer policy generally has a negative effect on the technical efficiency of town halls. The study attributes this to moral hazard and to the more limited discretion that local authorities have over how financial resources are allocated at local level.
The study therefore calls for systemic reforms. They concern, first of all, changing the current transfer system, strengthening financial autonomy and resolving the excessive fragmentation of the territorial-administrative structure, all of which weigh negatively on the efficiency of town halls. Implementing these measures effectively matters all the more because efficiency has a major impact on local development.
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