An Assessment of the Efficiency of Decentralization in the Execution of Public Works

This paper analyzes the efficiency of infrastructure provision in Italy at the execution stage, focusing on the level of government involved. Different nonparametric and parametric frontier estimates are generated to estimate an input distance function for a large sample of Italian public works in the period 2000–2005. Decentralized contracting authorities appear to be systematically less efficient in managing the execution process. These empirical findings are robust to alternative estimators and empirical strategies and suggest that decentralized authorities might lack the adequate bureaucratic structures to manage the execution stage efficiently.