A bigger bang for the public buck: A non-parametric efficiency analysis of state highway infrastructure investment

Abstract

Purpose

It is well known that public infrastructure, particularly the transportation infrastructure sector, is notorious for low efficiency, spending waste and corruption. Achieving the efficiency of public infrastructure investment is a crucial element to improve the current deteriorating condition of American transportation infrastructure system. The paper aims to discuss these issues.

Design/methodology/approach

This research utilizes an input-oriented, variable return to scale non-parametric data envelopment analysis to estimate the relative cost efficiency of highway infrastructure investment among the 48 American continental states from 1995 to 2009.

Findings

The empirical results reveal that there is a large efficiency variation among state highway infrastructure systems.

Practical implications

In addition, state governments on average reach 95.8 percent of the efficiency of their best practice peers in terms of providing quality highway infrastructure outcomes.

Citation

Chen, C. (2018), "A bigger bang for the public buck: A non-parametric efficiency analysis of state highway infrastructure investment", Journal of Public Budgeting, Accounting & Financial Management, Vol. 30 No. 3, pp. 270-285. https://doi.org/10.1108/JPBAFM-06-2018-009