Carone, G., Eckefeldt, P., Giamboni, L., Laine, V., & Pamies, S., 2016, Pension Reforms in the EU since the Early 2000’s: Achievements and Challenges Ahead. European Commission Discussion Paper.
Charnes, A., Cooper, W., and Rhodes, 1978, E. “Measuring the Efficiency of Decision Making Units.” European Journal of Operational Research.
European Commission and Economic Policy Committee, 2015, The 2015 Ageing Report: Economicand Budgetary Projections for the 28 EU Member States (2013–60), (European Commission: Brussels)
Haltiwanger, J., and M. Singh, 1999, “Cross-Country Evidence on Public Sector Retrenchment,” World Bank Economic Review, Vol. 13, No. 1, pp. 23–66.
Holzmann, R., Y. Pouget, M. Vodopivec, and M. Weber, 2011, “Severance Pay Programs around the World: History, Rationale, Status, and Reforms,” IZA Discussion Paper No. 5731 (Bonn: Institute for the Study of Labor).
International Monetary Fund, 2012, “Fiscal Policy and Employment in Advanced and Emerging Economies,” Policy Paper (International Monetary Fund: Washington)
International Monetary Fund, 2014, Public Expenditure Reform: making Difficult Choices, Fiscal Monitor, 90 p., (International Monetary Fund, Washington).http://www.imf.org/external/pubs/ft/fm/2014/01/pdf/fm1401.pdf.
International Monetary Fund, 2016b. “Managing Government Compensation and Employment—Institutions, Policies, and Reform Challenges.” (International Monetary Fund: Washington).
Liu, C., & Garcia-Escribano, M., 2017, “Expenditure Assessment Tool 1,” Expenditure Assessment Tool.” (International Monetary Fund: Washington).
Organization for Economic Co-operation and Development, 2011, “Getting It Right: Restructuring the Government Workforce,” in Public Servants as Partners for Growth: Toward a Stronger, Leaner and More Equitable Workforce (Paris).
World Bank, 2015, “The State of Health Care Integration in Estonia. Summary Report,” (World Bank Group, Washington). Available via: https://www.haigekassa.ee/sites/default/files/Maailmapanga-uuring/summary_report_hk_2015.pdf
Prepared by Andreas Tudyka. The author would like to thank the Estonian authorities, and the participants of a seminar at the Central Bank of the Republic of Estonia, and the IMF’s Fiscal Affairs Department and in particular Mercedes Garcia-Escribano, and Maximilien Queyranne for helpful comments and suggestions.
The analysis in this SIP is based on the Expenditure Assessment Tool (EAT) and the European expenditure template developed by the IMF’s Fiscal Affairs Department (Liu and Garcia-Escribano, 2017).
Public-private wage differential (as a percent of private wage): based on a review of regression studies that control for skill differentials between the public and private sector. Numbers are calculated by taking the within-country average over time.
The government has pledged to keep government employment in full-time equivalent terms pegged at 12 percent of the population aged 15–74 years.
Estonia is a major recipient of the European Structural and Investment (ESI) Funds (European Regional Development Fund, European Social Fund, Cohesion Fund, European Agricultural Fund for Rural Development, European Maritime and Fisheries Fund) and is allocated EUR4.5 billion during the 2014–20 budget period.
The Gini index reduction measure of efficiency, calculated by Eurostat using EUROMOD, compares the market income (pre-redistribution, i.e., pre-tax-and-transfer) Gini index with the disposable income (post-redistribution, i.e., post-tax-and transfer) Gini index concentration of income inequality. At a maximum concentration, the index is 1, at absolute equality of incomes it is zero.
Occupational and private individual schemes that may help support retirees’ income are excluded.
HALE adjusts standard life-expectancy measures for severity of illnesses and quality of life factors. Other factors, such as the quality of the health care environment and financial risks, are not taken into account.
Developed by Farrell (1957), see also Charnes, Cooper, and Rhodes (1978). This approach relies on the calculation of a ‘best practice’ frontier comprising countries which display the optimal combination of inputs and outcomes. The distance from the frontier provides for all countries an efficiency score that can be used to estimate potential gains by improving efficiency to best-performer levels. The bigger the distance to the efficiency frontier, the more inefficient a country is in providing health services. DEA calculation outcomes are influenced by sample selection and measurement issues, and outliers can have a substantial impact on efficiency scores.
The EC’s 2015 Ageing report projects substantial decrease in the number of students in primary education over the period 2013–60.
Also see the Selected Issues Paper “Public Investment Management in Estonia: Key Institutions and Reform Priorities.”