The Act on Assurance of Sound Financial Status of Local Governments and an Analysis of Cost Efficiency of Local Public Service Provision in Japan.

2017 Fiscal Year Final Research Report

• Project/Area Number: 15K03506
• Research Category: Grant-in-Aid for Scientific Research (C)
• Allocation Type: Multi-year Fund
• Section: 一般
• Research Field: Public finance/Public economy
• Research Institution: Niigata University
• Principal Investigator: SUMI EIJI 新潟大学, 人文社会・教育科学系, 准教授 (60337219)
• Project Period (FY): 2015-04-01 – 2018-03-31
• Keywords: 地方財政健全化法 / 確率フロンティア分析 / 費用効率性 / 将来負担比率 / 無投票当選

Outline of Final Research Achievements

This study investigated whether the Act on Assurance of Sound Financial Status of Local Governments that was enacted in 2007 in Japan improve cost efficiency of local government by using stochastic frontier analysis. Main findings are as follows. We found that 1) there was not a definite association that the Act improved cost efficiency of local government. 2) the increase of estimated amount of special revenue source that was deducted from the future burden amount of local government decreased cost efficiency.
In addition, we examined whether political competition in mayoral election reduces cost inefficiency of local government. We found that uncontested mayoral election significantly did not reduces cost inefficiency against expectations, while the longstanding incumbents decreased cost efficiency.

Free Research Field

地方財政論