The Effects of Size on Municipal Performance : A Panel Data Regression Analysis Estimated by Feasible Generalized Least Squares

This research aims to show the direct and indirect effects of size on the performance of the municipalities of Santa Catarina, due to the academic discussion about the size of the municipality affecting its performance. All municipalities in the state of Santa Catarina, from 2005 to 2016, were analyzed, including three electoral periods. The sample includes 3,504 observations, with 293 municipalities, over a 12-year period. Panel data regression analysis was estimated by Feasible Generalized Least Squares (FGLS). The results indicate that the size affects directly and positively municipal performance and indirectly when associated with the mayor's level of education. Thus, in the municipalities of Santa Catarina, the larger the population, the greater it will be the IPTU collected per capita. Also, larger population size associated with higher educated mayors, the greater the municipal performance. When performance is measured by the percentage of IPTU collected from total tax revenue, there is no effect on the size and size associated with the mayor's ability to govern