Cost-Benefit Analysis of Performance Based Budgeting Implementation

Trenovski, Borce and Nikolov, Marjan (2015): Cost-Benefit Analysis of Performance Based Budgeting Implementation. Published in: CEA Journal of Economics , Vol. 10, No. 20 (December 2015): pp. 5-43.

Abstract

This is the first study which estimates costs and benefits of overall policy reform for implementation of performance based budgeting. Costs estimation is based on a phased implementation, where we consult the Regulatory Impact Assessment methodology. In order to estimate benefits, we use a microeconomic approach to assess technical efficiency (Data Envelopment Analysis-DEA and Stochastic Frontier Analysis-SFA) of the budget users. The estimated benefits are higher than the estimated costs, or for every Macedonian denar invested in this reform an additional 2,600-8,000 Macedonian denars of gross value added in the Macedonian GDP are expected.

• Item Type: MPRA Paper
• Language: English
• Keywords: performance based budgeting, cost–benefit analysis, budget systems, public finance, technical efficiency, Macedonia.
• Subjects: H - Public Economics > H1 - Structure and Scope of Government > H11 - Structure, Scope, and Performance of Government; H - Public Economics > H6 - National Budget, Deficit, and Debt > H61 - Budget ; Budget Systems; H - Public Economics > H6 - National Budget, Deficit, and Debt > H62 - Deficit ; Surplus

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