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Scale, Performance And The New Public Management: An Empirical Analysis Of Local Authority Services

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  • George A. Boyne

Abstract

New public management (NPM) arguments on strategy and structure suggest that performance is enhanced if large organizations are disaggregated into smaller units. the NPM perspective reflects the views of public choice theorists who claim that big organizations are unresponsive to public needs, inefficient and fail to achieve their formal goals. These arguments have underpinned many recent changes in the structure of public services at both central and local levels. This paper uses data on six local government services to test the NPM hypothesis that there is a negative relationship between scale and performance. Five dimensions of performance are analysed: service coverage, quality, speed of provision, efficiency, and administrative effectiveness. Scale is measured through indicators of service output, caseload and needs. the impact of scale is tested in multivariate statistical models which control for other potential influences on variations in performance across local authorities. Only around half of the statistical evidence suggests that the smallest local units are the best performers. In addition, even when performance does decline with scale, this trend is reversed in the very largest units. Thus, contrary to NPM arguments, the biggest organizations are seldom the poorest performers.

Suggested Citation

  • George A. Boyne, 1996. "Scale, Performance And The New Public Management: An Empirical Analysis Of Local Authority Services," Journal of Management Studies, Wiley Blackwell, vol. 33(6), pages 809-826, November.
    • Handle: RePEc:bla:jomstd:v:33:y:1996:i:6:p:809-826
    DOI: 10.1111/j.1467-6486.1996.tb00173.x
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    Cited by:

    1. Ricardo Correa Gomes & Solange Alfinito & Pedro Henrique Melo Albuquerque, 2013. "Analyzing local government financial performance: evidence from Brazilian municipalities 2005-2008," RAC - Revista de Administração Contemporânea (Journal of Contemporary Administration), ANPAD - Associação Nacional de Pós-Graduação e Pesquisa em Administração, vol. 17(6), pages 704-719.
    2. George A. Boyne & Richard M. Walker, 1999. "Social Housing Reforms in England and Wales: A Public Choice Evaluation," Urban Studies, Urban Studies Journal Limited, vol. 36(13), pages 2237-2262, December.
    3. Cuadrado-Ballesteros, Beatriz & García-Sánchez, Isabel-María & Prado-Lorenzo, José-Manuel, 2013. "Effect of modes of public services delivery on the efficiency of local governments: A two-stage approach," Utilities Policy, Elsevier, vol. 26(C), pages 23-35.
    4. Rhys Andrews & George A Boyne, 2008. "Organizational Environments and Public-Service Failure: An Empirical Analysis," Environment and Planning C, , vol. 26(4), pages 788-807, August.
    5. Rhys Andrews, 2013. "Local government size and efficiency in labor-intensive public services: evidence from local educational authorities in England," Chapters, in: Santiago Lago-Peñas & Jorge Martinez-Vazquez (ed.), The Challenge of Local Government Size, chapter 7, pages 171-188, Edward Elgar Publishing.
    6. Germà Bel & Marianna Sebo, 2020. "Introducing and enhancing competition to improve solid waste management in Barcelona," IREA Working Papers 202004, University of Barcelona, Research Institute of Applied Economics, revised Apr 2020.
    7. Marius Constantin PROFIROIU & Septimiu Rares SZABO, 2016. "Outsourcing vs decentralisation: A comparative analysis in Central and Eastern Europe," Eco-Economics Review, Ecological University of Bucharest, Economics Faculty and Ecology and Environmental Protection Faculty, vol. 2(2), pages 3-26, December.
    8. Rhys Andrews & George A. Boyne, 2009. "Size, Structure and Administrative Overheads: An Empirical Analysis of English Local Authorities," Urban Studies, Urban Studies Journal Limited, vol. 46(4), pages 739-759, April.
    9. Rhys Andrews, 2015. "Vertical consolidation and financial sustainability: evidence from English local government," Environment and Planning C, , vol. 33(6), pages 1518-1545, December.
    10. Tavares Antonio F., 2018. "Municipal amalgamations and their effects: a literature review," Miscellanea Geographica. Regional Studies on Development, Sciendo, vol. 22(1), pages 5-15, March.
    11. Rhys Andrews, 2012. "Local Government Size and Efficiency in Labour Intensive Public Services: Evidence from Local Educational Authorities in England," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1214, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.

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