The paper presents an estimate of the expenditure requirements to be used as a benchmark in the identification of best practices in the spending behavior of the municipalities. In order to distinguish the determinants of theoretical expenditure requirements with respect to those relating to current expenditure we use a two-stage procedure. The first stage includes the municipalities in homogeneous groups according to structural factors through clustering techniques; in the second stage we estimate current expenditure through variables that capture peculiar factors and preferences within groups identified at the first stage
