Abstract
Local Economic Development (LED) is a key component of South Africa's developmental local government mandate, yet questions remain about whether LED units effectively convert public resources into improved welfare outcomes. This study assesses the efficiency of LED units across South Africa's eight metropolitan municipalities from 2010 to 2022 using a quantitative input-oriented Data Envelopment Analysis approach. LED budgets are evaluated against welfare indicators derived from the Human Development Index, including life expectancy, education, income, and unemployment. The findings reveal variation in technical, scale, and overall efficiency across metropolitan municipalities. The City of Tshwane and the Mangaung Metropolitan Municipality consistently perform well, while Buffalo City and eThekwini Metropolitan Municipalities exhibit inefficiencies. The city of Johannesburg demonstrates strong technical efficiency but weak scale efficiency, pointing to constraints. The study provides a performance-based framework for evaluating LED effectiveness and highlights the importance of institutional capacity and scale alignment in advancing welfare-oriented local development.