A Study of the Impact of Fiscal Decentralization on the Efficiency of Public Health Expenditure


Fiscal decentralization
Fiscal expenditure efficiency
Public health expenditure




In this present-day global pandemic that has not been completely resolved, health is a major concern among people, and correspondingly, people are demanding higher standards for public health products and services provided by the government. In this paper, we measure the technical efficiency of public health expenditure in each province by using the data envelopment analysis (DEA) model, and examine the impact of decentralization on the efficiency of public health expenditure under the fiscal decentralization system using the panel data from 31 provinces from 2012–2019 in a panel model subject to fixed effects.


Bouckaert G, 1992, Productivity Analysis in the Public Sector: the Case of the Fire Service. International Review of Administrative Sciences, 58(2): 175–200.

Retal VB, 1993, Risperidone as Add-On Therapy in Behavioural Disturbances in Mental Retardation: A Double-Blind Placebo-Controlled Cross-Over Study. Acta psychiatrica Scandinavica, 87(3): 167–171.

Fare R, Grosskopf S, 1997, Profit Efficiency, Farrell Decomposition and the Mahler Inequality. J Economics Letters, 57(3): 283–287.

Wang J, 2007, Research on the Size of Government Health Expenditure in China-Three Misconceptions and Empirical Evidence. Management World, 2007(2): 27–36.

Han HW, Miao YQ, 2010, An Empirical Study of Local Government Health Expenditure Efficiency Accounting and Influencing Factors-DEA-Tobit Analysis Based on Panel Data of 31 Chinese Provinces. Finance and Economics Research, 36(5): 4–15 + 39.

Grossman M, 1972, The Demand for Health: A Theoretical and Empirical Investigation. Michael Grossman, 137(2): 279.

Tiebout CM, 1956, A Pure Theory of Local Expenditures. Journal of Political Economy, 64(5): 416–424.

Xiao HX, Zhou F, Shao CX, 2011, Accounting for the Efficiency of Local Government Health Expenditure and Analysis of Influencing Factors. Statistics and Decision Making, 2011(23): 80–83.

Tu Y, 2015, A Study on the Efficiency of China’s Government Health Care Spending and Its Influencing Factors. Finance and Accounting Monthly, 2015(33): 69–73.

Hayek FA, 1945, Social Goals and Economic Institutions by Frank D. Graham. Journal of Political Economy, 53(2): 177–179.

Chen S, Zhang J, 2008, A Study on the Efficiency of Local Government Expenditure in China: 1978-2005. China Social Science, 2008(4): 65–78.

Besley T, Ghatak M, 2007, Reforming Public Service Delivery. Journal of African Economies, 16: 127–156.

Fisman R, Gatti R, 2002, Decentralization and Corruption: Evidence Across Countries. Journal of Public Economics, 83(3): 325–345.

Arikan GG, 2004, Fiscal Decentralization: A Remedy for Corruption?. International Tax and Public Finance, 11(2): 175–195.

Wellisch D, Hulshorst J, 2000, A Second-Best Theory of Local Government Policy. International Tax and Public Finance, 7(1): 5–22.

Sun R, Gao Z, 2016, Research on the Efficiency of Medical and Health Financial Expenditure and Its Influencing Factors in Gansu Province. Economic Research Reference, 2016(17): 40–47.

Lin X, 2016, The Impact of Fiscal Decentralization on the Efficiency of Local Public Health Care Service Supply. Finance and Economics, 2016(08): 6 + 8.

Vanden EP, Tulkens H, Jamar MA, 1993, Cost efficiency in Belgian Municipalities, Core Discussion Papers.

Bardhan P, Mookherjee D, 2000, Capture and Governance at Local and National Levels. The American Economic Review, 90(2): 135–139.

Heinberg JD, Oates WE, 1972, The Incidence of Differential Property Taxes on Rental Housing: An Addendum. National Tax Journal, 25(2): 221–222.