Putting all one's eggs in one basket: Relational contracts and the management of local public services

Desrieux, Claudine; Chong, Eshien; Saussier, Stéphane

doi:10.1016/j.jebo.2012.03.001

Cited by 24 publications

(15 citation statements)

References 34 publications

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“…In spite of its limitations, the relational contract model represents a step forward to the analysis of organizational arrangements by providing: (1) a way to create synergies between TCE and the so‐called new property rights/CT; (2) an integrative theoretical framework to analyze the role of contracts within a variety of organizational arrangements; and (3) testable hypotheses that were missing in the mainstream CT (e.g., Desrieux, Chong, & Saussier, ; Karantininis & Graversen, ; Macchiavello & Miquel‐Florensa, ; Macchiavello & Morjaria, ). Relational contracts define a setting in which contracts cannot do it all but can nevertheless be self‐enforcing, thanks to the key role of managers.…”

Section: Conceptual Backgroundmentioning

confidence: 99%

Organization and governance in the agrifood sector: How can we capture their variety?

Ménard

2017

Agribusiness

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The variety of solutions to organize economic activities is striking, and underexplored. This paper proposes a framework that combines transaction cost and relational contracts models to capture this variety while characterizing some representative forms. The framework distinguishes between organizational structures differing according to the intensity of control exercised over the rights to use resources, and the modalities of governance through which these structures operate. The combination of these two dimensions provides tools for understanding the existence, characteristics, and conditions under which some organizational arrangements tend to prevail. Based on these premises, the paper proposes an analysis that goes beyond the dichotomy between "markets" and "hierarchies." This framework is inclusive of those hybrids arrangements that play such an important role in the agrifood industry and it explores two modalities that are particularly challenging to standard theories: cooperatives and plural forms. [EconLit citations: D 230; L 0; Q 100].MÉNARD 143 that support agrifood activities. Governance here is intended as the set of devices implemented within organizations, or among networks of organizations, to allocate and monitor assets and rights, providing the backbone to economic activities. Hence, governance identifies the means that make alternative organizations operational, whereas organizations are the structures entitled of rights and performing transactions, structures within which modalities of governance are embedded (e.g., a cooperative is an organization, whereas its decision-making rules constitute a modality of governance).These two interwoven components, organization and governance, are essential for understanding how an economic system works. As Ronald Coase (Coase, 1937(Coase, , 1998 indicated, finding the appropriate organization of transactions influences the capacity of taking advantage of the division of labor and specialization that feed growth. And it is through the modalities of governance associated to alternative organizations, for example, the type of contract linking partners, that bargaining power is delineated and that negotiations develop. Indeed, from an economic point of view a negotiation is primarily about the allocation of rights to use goods or services, which characterizes the type of organization and determines the power of the different parties involved. This paper explores these issues along the following lines. Section 2 discusses why the variety of organizations and their modalities of governance matter so much to theoreticians as well as decision makers. Section 3 revisits two theories, TCEs and relational contracts, which complement each other in supplying essential tools for understanding organizational diversity and its logic. Section 4 discusses some particularly challenging cases when it comes to applying this framework to the analysis of the agrifood industry. Section 5 concludes. WHY DO ORGANIZATIONAL STRUCTURES MATTER?Identifying the various organizations and...

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Section: Conceptual Backgroundmentioning

confidence: 99%

Organization and governance in the agrifood sector: How can we capture their variety?

Ménard

2017

Agribusiness

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“…Coviello et al (2018) describe the operation of forward linkages in governments' repeat contracting with the same suppliers for public works in Italy. Desrieux et al (2013) provide evidence of lateral linkages, showing that French municipalities often contract with the same private organization for multiple functions.…”

Section: Contract Enforcement and Political Economymentioning

confidence: 91%

“…Coviello et al () describe the operation of forward linkages in governments’ repeat contracting with the same suppliers for public works in Italy. Desrieux et al () provide evidence of lateral linkages, showing that French municipalities often contract with the same private organization for multiple functions. Multiple and repeated contracts make the supplier–buyer relationship more valuable and gives contracting parties the incentive to honour the spirit of the contract even if it cannot be enforced or is costly to enforce.…”

Section: Outsourcing and Public Service Conglomeratesmentioning

confidence: 99%

Mutual dependence or state dominance? Large private suppliers and the British state 2010–15

Greasley

2019

Public Administration

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As public outsourcing has grown, the need to understand government's relations with supply side actors has become more important for public administration scholars. The article analyses the role of a small group of large contractors in the British outsourcing system during Britain's Coalition government. These ‘public service conglomerates’ have thus far received little attention in the public administration literature. The article compares two approaches for understanding the role of these corporations and analyses why the corporations faced sometimes severe disruption during the Coalition period in the form of multiple contract problems, conflict with ministers and financial problems. Over the period, the corporations became the objects of policy debate, and what had appeared to be a stable set of arrangements started to fracture. The case shows the value of analysing the political and organizational foundations of contracting arrangements.

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“…Secondly, when public authorities contract out services to private providers, the actual outcome depends on coordination and collaboration between public managers and private actors (Mattisson and Thomasson, 2007;Desrieux, Chong and Saussier, 2013;Peat and Costly, 2001;Lenferink, Tillema and Arts, 2013). Specifically, outcomes depend on the ability to align goals, ensure compatibility between different organizational systems, create synergies, avoid gaps and overlaps in the provision of services, and solve emerging problems.…”

Section: Impact Factorsmentioning

confidence: 99%

The impact of governance on the outcomes of contracting out

Torfing

Sørensen

Brogaard

2017

Journal of Strategic Contracting and Negotiation

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Whether contracting out to private actors results in value for money depends on how public authorities govern, organize and manage service contracting. However, only a few studies have attempted to investigate how local governing practices can help to ensure that the contracting out of public services enhances economic efficiency and service quality. To further advance our knowledge on this topic, we present the results of a systematic review of 21 international studies, published between 2000 and 2018, on the impact of governance on the outcomes of contracting out. We combine insights from the reviewed studies to develop a theoretical framework of use to both practitioners and researchers that posits how eight impact factors mediate the influence of local governance on the outcomes of contracting out.

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Putting all one's eggs in one basket: Relational contracts and the management of local public services

Cited by 24 publications

References 34 publications

Organization and governance in the agrifood sector: How can we capture their variety?

Organization and governance in the agrifood sector: How can we capture their variety?

Mutual dependence or state dominance? Large private suppliers and the British state 2010–15

The impact of governance on the outcomes of contracting out

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