Voice or Public Sector Management? An Empirical Investigation of Determinants of Public Sector Performance based on a Survey of Public Officials

Drawing on an in-depth governance micro-survey of public officials within a country, we address empirically the question of the relative importance of the various determinants of governance. We investigate the causes of poor governance, and show that commonly made inferences about policy based on simple correlation can be highly misleading, because the high correlation between the various governance (and public sector management) determinants, as well as the endogeneity in these variables. We find that undue emphasis may have been given in previous work to a number of conventional public sector management variables (such as civil servant wages, internal enforcement of rules, autonomy of agency by fiat, etc.), while undermining the priority due to more ‘external’ (to public sector management) variables, such as external voice, transparency, and politicization. The latter set of ‘voice’-related variables has larger affect on the quality of service and corruption than the more traditional public sector management type of variables. Further work drawing in depth on country-specific surveys in other settings is warranted to ascertain with more confidence whether a shift towards more prominence to transparency and ‘voice’-type of variables is needed, backstopping the results for Bolivia in this paper.

THE POLITICAL ECONOMY OF PUBLIC SPENDING ON PUBLICLY-PROVIDED GOODS IN DEVELOPING COUNTRIES

It is common for many governments to provide services, such as education or healthcare, to the public even though many of these services have privately available counterparts. Although the literature on public economics has studied various determinants of policy choice, it typically takes granted the existence of institutions which are often very weak in less-developed countries. More importantly, many developing countries experience widespread corruption in the public sector, which undermines the functioning of governments. In this dissertation we have developed a probabilistic voting model using political pressure approach to characterize the policy choice in a local government. Politicians seek to maximize their chances of reelection by maximizing the social welfare. They are also influenced by special interest groups seeking public funds for their own benefit. In this model leakage of public funds undermines the quality of public services. In response, the wealthy switch to private alternatives. Their exit leaves the poor as the only constituents who have a stake in local governance but with little influence over politicians. As the civic control over local governments weakens, corruption in public offices becomes even more pervasive. Such a cycle is less likely to be observed in developed countries, where Tiebout's "voting-by-feet" functions relatively well (thereby keeping redistributive politics in check) and local politicians are more sensitive to the electorate. Our model shows that establishing institutions (such as local taxation or voucher programs) that spread the costs and benefits of governance across the whole society is crucial for the success of local governments. Empirical results from the Philippines showed that local financing, coupled with political participation of citizens, may increase the allocation of resources on publicly provided services, that corruption in local governments is less problematic in communities that rely on local taxation, that households are more likely to participate in political processes if local government spending is financed mainly through local taxes, and finally, that demand of the wealthy for publicly provided services is among the primary forces that facilitate better governance and better public services

Kuresel Isinma, Kuresellesme ve Gida Krizi - Turkiye'de Islenmis Gida Fiyatlari Uzerine Ampirik Bir Calisma

For central banks, whose primary objective is to maintain low and sustainable inflation, understanding the determinants of food prices and their sensitivity to monetary policy is crucial for measuring the effectiveness of policy actions. This study empirically analyzes the determinants of the processed food inflation in Turkey. The findings point out that the recent acceleration in the processed food inflation mostly stems from supply side shocks triggered by domestic drought and the upsurge in the international food prices. The emergence of a steep difference between the level of temperature and the seasonal averages gives rise to an increase in the processed food inflation, whereas moderate rise in the temperatures above the seasonal averages slows down the food inflation. The study indicates that the import prices mostly affect the domestic processed food prices through the processed intermediate food products rather than consumption goods. Exchange rate pass-through to processed food prices is faster than the import price pass-through and its effect is mostly felt within the first three months of a change in the exchange rate. The effect of total demand conditions is found to be relatively weak in the sample period considered in this study.Food prices, Inflation dynamics

Kuresel Kriz ve Politika Uygulamalari

Bu calismada, kuresel kriz oncesinde uygulanan para, kur ve maliye politikalari ile bankacilik sektorune iliskin duzenleme ve denetim faaliyetlerinin, kuresel kriz sirasinda ulkelerin maruz kaldigi iktisadi ve finansal kosullari nasil etkiledigi incelenmistir. Gozlemler, dalgali kur rejiminin iktisadi birimlere ve politika yapicilara sagladigi esneklik, kuresel likidite bollugu sirasinda bankacilik sisteminin asiri risk almasini engelleyen politika uygulamalari ve kriz oncesinde izlenen dengeleyici para ve maliye politikalarinin kazandirdigi hareket alani gibi unsurlarin ulkelerin krize karsi dayanikliliklarini belirlemede etkili oldugu gorusunu desteklemektedir. Turkiye ekonomisi de, 2001 yilindan bu yana gerceklestirdigi yapisal donusum ve politika uygulamalari ile bu basliklarin bircogunda olumlu bir gorunum sergilemis ve kuresel soklara karsi onemli bir direnc gostermistir.

Kuresel Kriz, Etkilesim Kanallari ve Turkiye Ekonomisi

Bu calismada, ulkelerin kuresel krizden etkilenme derecesinde gozlenen farklilasmada dis ticaret, dis finansman ve beklenti kanallarinin rolu incelenmektedir. Bulgular, ihracatin ekonomi icindeki agirligi yuksek olan, kuresel ekonominin devresel hareketlerine duyarli urunler ihrac eden ve yurt ici tasarruf acigi nedeniyle dis finansman kaynakli buyume sergileyen ulkelerin kuresel krizden daha olumsuz etkilendiklerini gostermektedir. Ayrica, Turkiye ekonomisinin, yapisal ozellikleri nedeniyle, kuresel soklarin olumsuz etkisini her uc kanal uzerinden de hissettigi gozlenmektedir.