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Thursday, August 02, 2007
Deprivatizationification
For all you fellow privatization nerds out there, if you're out there, here's an interesting paper on what's called "contracting-in," or when government decides to do in-house something that it once contracted out. Apparently this has been happening quite frequently on the local level, as public managers decide that sometimes contracting out is wasteful and doesn't achieve the goals of reducing costs and encouraging innovation like it was supposed to. The federal predisposition towards contracting out regardless of its practical value, which has given us the $400 billion a year contracting industry, should provoke a similar backlash at some point, too, you'd think.
Anyway, here's the abstract:
Empirical evidence shows local government contracting is a dynamic process that includes movements from public delivery to markets and from market contracts back to in-house delivery. This ''reverse contracting'' reflects the complexity of public service provision in a world where market alternatives are used along with public delivery. We develop a methodology to link responses to national surveys and create a longitudinal data set that captures the dynamics of the contracting process. We present a framework that incorporates principal agent problems, government management, monitoring and citizen concerns, and market structure. Our statistical analysis finds government management, monitoring, and principal agent problems to be most important in explaining both new contracting out and contracting back-in. Professional managers recognize the importance of monitoring and the need for public engagement in the service delivery process. The results support the new public service that argues public managers do more than steer a market process; they balance technical and political concerns to secure public value.
Posted by Matt Lewis
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