Efficiency of the Investment Activity of Polish Communes in Rural Areas

Abstract

The purpose of this paper was to evaluate the efficiency of investment activity in the communes in Poland. The commune is a basic unit of local government in Poland, and rural and urban-rural communes constitute the vast majority of municipalities. Communes in their own name and on their own account carry out public tasks that cover all tasks of local interest, including technical and environmental infrastructure. Despite many researches on the efficiency of communes, there are no studies on selected activities as well as on rural areas only. The nonparametric method of technical efficiency Data Envelopment Analysis (DEA) was used in the study. The inputs and the effects of investment activity of rural and urban-rural communes in 2007-2013 were compared. This period was related to the duration of EU support programs. The study was conducted on the basis of data from the Local Data Bank which is Poland's largest database of the economy, society and the environment. The ranking of investment activity for communes were made based of the calculated average for indicators of efficiency. The studies conducted show that the amount of expenditure incurred on the studied spheres of investment activity of the analyzed communes does not translate into their efficiency. This is connected with the possibility of obtaining additional funds from EU. Information on the use of EU funds for financing the municipal investments were not included in the study due to lack of data before 2010. Among the analyzed rural and urban-rural communes the most efficient ones were located in the Mazowieckie, Świętokrzyskie and Lubelskie voivodships, although they were not fully efficient throughout the considered period. Due to its closeness to the capital, the municipality of Mazowieckie voivodeship belongs to an area with a high degree of urbanization. Communes from the Świętokrzyskie and Lubelskie voivodships belong to regions characterized by a high share of rural areas. The dynamic development of infrastructure is extremely important in terms of divergence between regions of the country.

Measuring the Efficiency of Polish Municipalities – Data Envelopment Analysis Approach

“…On the other hand, there can be found research study that is in the opposite to the postulates of the obtained findings. The studies conducted by Kobiałka and Kubik (2018) show that the amount of expenditure incurred on the studied spheres of investment activity of the analyzed communes does not translate into their efficiency. Detailed findings of conducted research study can be found below.…”

Local government expenditure in the Lublin voivodeship in 2010-2018

“…Next to the communes of the Świętokrzyskie and Mazowieckie voivodeships, the communes of the Lubelskie voivodeship were among the most effective in terms of implementing infrastructural investments (cf. Kobiałka and Kubik, 2017). Since 2017 a growing trend has been observed again for the share of investment property expenditure in total expenditure.…”