Institutions, quality competition and public service provision: The case of public education

Abstract

Abstract. This paper contributes to the literature on intergovemmental competition in two ways. First, the institutional setting within which public services are delivered is analyzed with respect to the impact on the quality of services provided. Previous studies have measured competition only in terms of governmental structure, ignoring the issue of service quality and the potential for differentiating local governmental jurisdictions along quality dimensions. Second, the outcome of competition is defined in terms of service quality. Previous studies generally have measured the outcome of competition by examining the fiscal effects of fragmentation and accountability through service costs or tax revenue impacts. School districts were used to empirically test quality competition. Student academic performance was modeled as a function of control variables and the degree of competition from neighboring school districts. Academic performance in public schools was positively associated with the performance of neighboring districts, although the effect was small. These findings, however, suggest that strategies to strengthen interjurisdictional competition may be useful in enhancing public service quality.

Sources of Public Service Improvement: A Critical Review and Research Agenda

“…The validity of this theoretical perspective has been investigated in eighteen studies (see table 4). Measures of competition include the number of suppliers in a local market (e.g., Bradley, Jones, and Millington 2001;Christensen and Sachs 1980;Staley and Blair 1995), the distribution of market shares (e.g., Borland and Howsen 1992;Grosskopf et al 2001), rivalry between public and private suppliers (e.g., Arum 1996;Domberger, Hall, and Li 1995), and service managers' perceptions of the intensity of competition (D'Aunno, Hooijberg, and Munson 1991). The evidence on the impact of competition on service performance is very mixed.…”

Tiebout Competition, Yardstick Competition, and Tax Instrument Choice: Evidence from Ohio School Districts

“…efficiency. See, for example, the work of Staley and Blair (1995) and Hoxby (2000). Building off the work of Brennan and Buchanan (1980) on constraining Leviathan, Stansel (2006) finds slower government growth in more competitive areas.…”

Public Private Partnership between Local Governments and Nonprofits in Japan

“…Regional disparities of public service provision for level and quality may influence local residents' preferences and demands for public services. Disparities might also influence local governments' competitiveness or lock-step mentalities to meet the same service provision level as their neighboring local governments (Staley & Blair, 1995). Such neighborhood or demonstration effects in local government decision-making would likely occur in PPP practices.…”