Determinants of local government expenditures

Abstract

The subject of my thesis is the determinants of local government expenditures. The aim is to explain the differences in expenditure pattern using the characteristics of the municipalities of Flanders. The differences arise because every local community has a budget available that it can invest in what it wants. The goal of the thesis can be achieved by making a correlation between several characteristics and the expenditures of the municipalities. Finally we tried to make a regression model with the expenses and the significant determinants of the municipalities to see if it is possible to construct a model with the determinants which describes the expenses accurately. The overall conclusion is that the characteristics of municipalities influence the expenses of the local communities. It is possible to explain the large differences between the municipalities but it is not possible to construct a model with the determinants which describes the expenses accurately.