Various studies have analyzed the relationship between fiscal stress and contracting out, but have failed to achieve conclusive results. In this article, we take a broad view of fiscal stress, addressed in terms of financial condition and studied over a lengthy period (2000-2010). The relationship between fiscal stress and contracting out is studied using a dynamic model, based on survival analysis, a methodology that enables us to take into account the effect of time on this relationship. As this study period includes the years of the Great Recession (2008-2010), we also highlight the impact of this event on the fiscal stress-contracting out relation. The results obtained suggest that taking into account the passage of time and conducting a long-term assessment of financial condition enable a more precise understanding of this relation. We also find that the Great Recession reduced the probability of local governments' contracting out public services.

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The aim of this study was to conduct an analysis of the elements of public finances that favor the contracting out of social services, together with political and socioeconomic issues. The results obtained reflect the existence of significant differences in this respect according to the size of the municipal population, and show that while most indicators of a worsening financial condition, together with the neighborhood effect and a conservative political ideology, increase the likelihood of contracting out taking place, the “Austerity Machine” is not, in fact, associated with a greater probability of social care being contracted out in larger municipalities.

After analysing the explanatory factors underlying the renewal of privatisation contracts, this paper examines the likelihood of local authorities renewing their contracts with private entities for the provision of public services, by studying a sample of 623 Spanish municipalities for the period 2002–2013, using a logit model. The type of service, the duration of the contract and certain political and economic factors were all found to influence the renewal or otherwise of this type of contract. Moreover, this effect differed between initial privatisation and subsequent contract renewal.

The aim of this article is to determine whether there is opportunistic behavior in local government decisions related to contracting out, publicprivate partnership (PPP) and/or public externalization. Analysis of the results obtained from applying a fixed effects panel data model to a sample of 2,274 Spanish municipalities supports the existence of asymmetric opportunistic behavior. Specifically, there is strong evidence that in preelection years, there is less likelihood of contracting out and PPP decisions being approved, and a greater probability of public externalization taking place. In post-election years, an increase in capital spending is associated with a lower probability of contracting out and of PPP. An increase in current spending in preelection years reduces the probability of decisions being taken on contracting out and PPP. These empirical results highlight the extent of opportunistic behavior in selecting management forms for the delivery of local government services.