The Korea Local Administration Review

This study intended to empirically analyze influence of change in liabilityratio of local public enterprises on operation efficiency change of local publicenterprises. For this, panel data were composed to conduct a panel regressionanalysis on 72 local sewage public enterprises utilizing yearly MalmquistProductivity Index as efficiency alteration index of dependent variable. Asindependent variables, liability ratio of local public enterprises was categorizedinto increase rate of total liability ratio, current liability ratio, and non-currentliability ratio and inside/outside factors with influence on operation efficiencychange were controlled. As a result of analysis, first, it was found that increaseor decrease rate of local sewage public enterprise liabilities did not havestatistically influence on improvement of operation efficiency irrespective of thecategory. Therefore, it is required to raise operation efficiency as establishingown management innovation efforts for local sewage public enterprises ofchronic deficit to local corporations. Second, it was found that increase rate offinancial independence rate as control variable had statistically negativeinfluence on efficiency change in local sewage public enterprises and thatincrease rate of cost realization rate had statistically positive influence.Therefore, it is necessary for concerned authorities to make efforts to solvestructural problems of existing low cost realization rate of local sewage publicenterprises.
□ Keywords: local public enterprise liabilities, local sewage, efficiency change