A methodological approach to the comparison of municipal balance-sheet figures

In the comparison of municipalities balance sheets figures, the per-resident ratios lose some of their relevance as indicators of municipal expenditure or taxation behaviour. At this level of spatial disaggregation, the resident population is generally not in a direct relationship with balance sheets figures; the problem is evident especially for those municipalities with significant flows of non-residents, demanding and paying for services. The paper provides a frame of reference within which the measurement of municipal behaviour is conditioned to the approximation of the unobserved "real" size of each individual municipality. The joint use of several types of information about the structure of municipalities yields composite indicators of greater statistical relevance than the usual indicators based on the residential population alone.