analysis of factors affecting financial efficiency and cost control in small municipalities

small municipalities face unique financial challenges due to limited revenue bases, high fixed costs, and constrained administrative capacity. unlike large cities, they cannot benefit from economies of scale and often struggle with cost control while maintaining essential services. this research analyzes the factors affecting financial efficiency and cost control in small municipalities, focusing on a sample of ۱۵ small municipalities in fars province, iran. using a mixed-method approach combining financial ratio analysis (۲۰۱۸-۲۰۲۴), semi-structured interviews with ۲۵ municipal managers and financial officers, and comparative case studies of three municipalities with high, medium, and low financial efficiency, the research identifies key drivers of financial performance. findings reveal that personnel costs account for ۶۵-۷۵% of total municipal budgets in small municipalities, significantly higher than the ۴۰-۵۰% observed in larger cities. three factors explain ۷۸% of the variation in financial efficiency: (۱) the ratio of own-source revenue to total revenue (positive effect), (۲) the number of permanent staff per ۱,۰۰۰ population (negative effect), and (۳) the presence of a multi-year financial planning system (positive effect). municipalities that have implemented activity-based costing and performance-based budgeting show ۳۰% lower per-capita operating costs. the research concludes that small municipalities can improve financial efficiency through revenue diversification, staff optimization, and adoption of modern financial management tools, but face structural barriers that require provincial-level policy support.

کلیدواژه ها:

financial efficiency ، cost control ، small municipalities ، municipal finance ، fars province