Is There a Link between User Charges and Expenditures on Public Kindergartens in Poland?

• Authors: Marcin Będzieszak
• Languages of publication: EN

Abstracts

EN

The aim of this article is to assess the link between user charges and expenditures on the service on the example of public kindergartens in Poland. The rationale behind the paper is that implementation of user charges for public service results in efficient use of resources and leads to the passing-on of expenditure increase to consumers. To achieve the aim, three methods were used, namely weighed-least-squares, fixed effect and random effect method. The empirical analysis based on a panel data set for 65 large Polish cities in the years 2012–2018 showed that about 10–25% of an expenditure increase is passed on to consumers in terms of higher user charge. Moreover, user charge financing has a significant negative effect on the unit cost. An increase in the share of user charges in expenditures by 10 pp causes a decrease in expenditure at the level of 2.5–50%.

PL

The aim of this article is to assess the link between user charges and expenditures on the service on the example of public kindergartens in Poland. The rationale behind the paper is that implementation of user charges for public service results in effiient use of resources and leads to the passing-on of expenditure increase to consumers. To achieve the aim, three methods were used, namely weighed-least-squares, fixed effect and random effect method. The empirical analysis based on a panel data set for 65 large Polish cities in the years 2012–2018 showed that about 10–25% of an expenditure increase is passed on to consumers in terms of higher user charge. Moreover, user charge financing has a significant negative effect on the unit cost. An increase in the share of user charges in expenditures by 10 pp causes a decrease in expenditure at the level of 2.5–5.0%.

Keywords

EN

fees; user charges; local budgets; tax and non-tax revenues

PL

fees; user charges; local budgets; tax and non-tax revenues

• Publisher: Wydawnictwo Uniwersytetu Marii Curie-Skłodowskiej
• Journal: Annales Universitatis Mariae Curie-Skłodowska, sectio H – Oeconomia
• Year: 2020
• Volume: 54
• Issue: 4

Dates

published

2020

online

2020-12-29

Contributors

author

Marcin Będzieszak

References

• Aaberge, R., & Langørgen, A. (2006). Measuring the benefits from public services: The effects of local government spending on the distribution of income in Norway. Review of Income and Wealth, 52(1), 61–83.
• Będzieszak, M. (2015). Dochody z opłat za usługi samorządowe a poziom wydatków w miastach na prawach powiatów. Zarządzanie Publiczne, 2(30), 151–163.
• Bierhanzl, E.J., & Downing, P.B. (1998). User charges and bureaucratic inefficiency. Atlantic Economic Journal, 26(2), 175–189.
• Blankart, C., & Fasten, E.R. (2011). Knut Wicksell’s principle of just taxation revisited. In: V. Caspari (ed.), The Evolution of Economic Theory. Essays in Honour of Bertram Schefold (pp. 132–141). London: Routledge.
• Borge, L.E., & Rattsø, J. (2005). The relationships between costs and user charges: The case of a Norwegian utility service. FinanzArchiv: Public Finance Analysis, 61(1), 98–119.
• Buchanan, J.M., & Brennan, G. (1980). The Collected Works of James M. Buchanan. Vol. 9: The Power to Tax: Analytical Foundations of a Fiscal Constitution. Indianapolis: Liberty Fund.
• Denek, E. (2007). Dyskusyjne problemy dostosowania dochodów do zadań samorządu terytorialnego. In: K. Piotrowska-Marczak, K. Kietlińska (red.), Harmonizacja finansów publicznych w skali narodowej i europejskiej (pp. 423–431). Warszawa: Difin.
• Feld, L.P., Kirchgässner, G., & Schaltegger, C.A. (2010). Decentralized taxation and the size of government: Evidence from Swiss state and local governments. Southern Economic Journal, 77(1), 27–48.
• Von Furstenberg, G.M., Green, R.J, Jeong, J.-H. (1985). Have taxes led government expenditures? The United States as a test case. Journal of Public Policy, 5(3), 321–348.
• Holtz-Eakin, D., Newey, W., & Rosen, H.S. (1989). The Revenues-Expenditures Nexus: Evidence from Local Government Data. International Economic Review, 30(2), 415–429.
• Keegan, W.J., Moriarty, S.E., Duncan, T.R., & Paliwoda, S.J. (1995). Marketing. Scarborough: Prentice Hall.
• Lindahl, E. (1958). Just taxation – a positive solution. In: R. Musgrave, A. Peacock (eds.), Classics in the Theory of Public Finance (pp. 168–176). UK: Palgrave Macmillan.
• Sun, R., & Jung, C. (2012). Does user-charge financing reduce expenditure levels for the charge-financed services? The American Review of Public Administration, 42(2), 170–185.
• Swianiewicz, Ł., & Łukomska, J. (2011). Finansowanie przedszkoli z różnych źródeł. Warszawa: ORE.
• Westerlund, J., Mahdavi, S., & Firoozi, F. (2011). The tax-spending nexus: Evidence from a panel of US state–local governments. Economic Modelling, 28(3), 885–890.

Identifiers

DOI

10.17951/h.2020.54.4.7-18