Administrative capacity and speed of public spending

This article examines the impact of administrative capacity on the speed of public spending in Italy. The analysis considers 58,922 projects managed by local administrations from 2010 to 2019, with project duration used as a reverse proxy of spending speed. The findings reveal that greater administrative capacity reduces project duration, thereby accelerating public spending. On average, a 1% increase in administrative capacity shortens project duration by 3%. Larger municipalities and those in central areas benefit more than smaller and peripheral municipalities. The capacity and quality of local bureaucracy are the key dimensions of administrative capacity that drive these results.