The municipalities efficiency in Israel: The case of the provision of educational services

This study examines the efficiency of supplemental educational allocations in Israel’s municipalities. Using bootstrap Data Envelopment Analysis on 83 municipalities for 2019–2020, we found low efficiency in resource allocation, indicating that the same output could be achieved while reducing local resources by 56 %. Regression analysis reveals a U-shaped relationship between efficiency and socioeconomic status overall, but a positive relationship for municipalities with a large percentage of ethnic majority residents. These findings have significant policy implications. Municipalities could consider implementing efficiency reforms, whereas the central government could design targeted plans and policies to enhance local resource allocation efficiency. This study contributes to the literature on resource efficiency and provides valuable insights for policymakers and administrators.