The Political Economy of Public Sector Governance

I am delighted to announce that the book I mentioned in this post is now published and available from Cambridge University Press.  Designed for students and empirical researchers, the book is meant to be a general, nontechnical introduction to core ideas in positive political theory as they apply to topics in public management and policy.

I am grateful for the endorsement of my former colleague Hal Rainey, who wrote:

“Bertelli provides a valuable resource for those who seek an improved understanding of the major ideas in the literature on the political economy of governance. He explains and applies the major concepts and theories, such as the principal-agent model, screening, signaling, and others, with effective examples. An important addition to graduate and upper-level undergraduate courses on governmental management and administration, public policy, and related topics, and for all scholars seeking a better grasp of this literature and its contributions.”

Likewise, I am indebted to Chuck Shipan for these very kind comments:

“The study of public management has undergone a revolution over the past two decades, with new approaches providing fresh insights into long-standing issues. As someone who is both firmly steeped in the traditional concerns and issues and also a major contributor to the new approaches, Tony Bertelli is the perfect person to serve as a tour guide to this revolution. The Political Economy of Public Sector Governance is lucid, engaging, and chock full of ideas for scholars and practitioners alike.”

I hope readers find the book useful and look forward to their comments.

Cabinet-Congress-President Ideal Point Data Available

I am pleased to announce that Christian Grose and I have released a datafile including the ideology estimates for U.S. presidents, legislators and cabinet secretaries used in Anthony M. Bertelli and Christian R. Grose. 2011. “The Lengthened Shadow of Another Institution? Ideal Point Estimates for the Executive Branch and Congress.” American Journal of Political Science 55(4): 767-81.  The dataset is available by following this link.

Strategic Capacity Building

I’ve been occupied over the past few weeks with finishing a textbook, The Political Economy of Public Sector Governance, for Cambridge University Press.  I’ve been told it will be in print next summer.  The book seeks to bring core ideas from the theoretical literature of — for want of a better term — the political economy of bureaucracy literature into MPA and MPP classrooms, and also to introduce them to applied public management researchers from a variety of backgrounds who would like to learn more.  In this sense, it is a hybrid book and wound up being one of my most difficult projects. The experience led me to think very carefully about my own teaching style and to add nuance to the many reasons why I respect authors of good textbooks.  Because it also forced me to make hard choices about which studies to discuss in a limited space, it was a very helpful reflection on a body of theory that I have thought about as an applied researcher for many years.

My primary focus in such reflection was about how this literature might be useful to applied scholars and practitioners of public management.  For instance, chapter 5 concerns government contracting with the private and nonprofit sectors.  An interesting extension of the insights of two recent delegation papers regards the acquisition of expertise by contractors. The essential idea is that an administrative agency or contractor makes choices about acquiring expertise that can have incentivize a particular shape for the policy agenda.  A recent paper by Michael Ting relies on the difference between specialist agencies, who can target their capacity-building investments to a particular task, and generalist agencies that cannot. The essential insight is that specialist agencies can create incentives for the government to undertake some tasks rather than others because they have developed the capacity to provide good outcomes precisely by doing things they prefer to do. In the book, I call this process strategic capacity building. Government may consequently take on things that it might not have but for the capacity choices of contractors.   Strategic capacity building also implies that the advocacy mission of non-profit organizations and the contracting environment work together to great effect, which is something that practitioners and scholars know well.  Paul Light, for instance, has argued that organizations that engage in capacity building can enhance organizational effectiveness, which in turn inspires donors and funders to provide additional support.

A very clever and insightful paper by Steven Callander unmasks another aspect for strategic capacity building. When tasks are complex, knowledge about how to do them is difficult for others to sequester.  His argument implies that we should expect capacity acquired by contractors over time to be in regard to complex, non-invertible tasks. Such capacity cannot be easily appropriated, particularly by political principals in furtherance of their policy agendas.  Strategic capacity building can, thus, produce two interesting outcomes. First, the government does not face a true market for services when making contracting decisions. This is because the services offered by potential contractors are defined, at least in part, by their strategic capacity building choices. Second, non-invertible capacity for complex tasks permits contractors to shape policies as they desire unless those outcomes are very far from those envisioned by government, or in other words, because there is substantial policy conflict between the government and contractor.

When non-profits and private firms become involved in the contracting state, they travel (with apologies to George Krause) a two-way street of policymaking with administrative agencies and politicians.

Why teach in a Distance MPA?

Starting in August, I will be teaching a distance course at the MPA (Master’s of Public Administration) level for the first time.  The School of Policy, Planning and Development is launching a new distance program this fall and my course is among the initial offerings.  The distance medium is intensely challenging for a beginner like me.  Why am I doing this?  Here is one reason.

I’ve become convinced that distance teaching in MPA programs is important.  Back in 2007, I wrote a paper about turnover intention in the federal service that launched an interest the sustainability of the public sector workforce.   Around the time I published my study, an OPM report suggested that about 18 percent of the federal workforce had become eligible to retire and that the median length service after becoming retirement eligible was four years.  In the 2010 Federal Employee Viewpoint Survey, fully 42% of the more than 247,000 respondents reported being with their current agency for longer than 20 years. Statistics for my home state of California are likewise striking with fully 51% of of the service comprised of Baby Boomers and only 11% Milennials according to the Department of Personnel Administration.  That imbalance warns that pre-service MPAs are not sending graduates into public service positions, and retirements are on their way.

With the dramatic cuts in budgets in these uncertain economic times, fewer of these positions are going to be filled and those that are require more training and skill to be productive in a leaner workforce.  Our training has to be more flexible if we who provide MPAs are going to meet those needs.  We have to recognize that our pre-service students will continue to find appealing jobs in the non-profit and private sectors and that our efforts to train the next generation of public servants must broaden.

If the need is there, we have to fill it with quality instruction.  I’m currently designing a first course in public management with the help of a team from Embanet-Compass and a teaching assistant, Anne Dobson, who took the course in residence last fall.  In future posts, I’ll share some of the challenges that translation to the new medium presents and how we have addressed them.

Risk and Return in British Politics

This week, my frequent collaborator Peter John will be presenting the first paper in a larger project on the prioritization of public policies by governments at the European Political Science Association meeting in Dublin. We argue that governments seek to enhance their chances of re-election by managing their risks from attending to particular policy problems. In this way, government is like an investor making choices about risk to yield returns on its investments of political capital. We claim that the public provides signals about expected political capital returns for government policies, or policy assets, that can be captured through expressed opinion in polls.[1] While always approximate, these price signals are at times noisier than others meaning that uncertainty in the environment in which governments must choose policies correspondingly differs. The amount of attention that a government gives to a policy domain, or what we call its investment level in a policy asset, generates return to political capital but also risk due to the variance of each asset and the covariance among them. The nub of our theory is that strategies of statecraft consider risk and return in their policy portfolios and uncertainty in the public’s policy valuation. We think this is a novel way for examining policymaking and leadership in government.

Drawing from a wealth of data in the UK Policy Agendas Project with which we are involved and a host of other sources, we test our claims in the UK between 1971-2000.  The graph below shows return to each of five policy asset classes throughout the period as well as price signal uncertainty from the public.
Note the stable and low returns associated with environmental policy compared with the high but volatile returns from economic policy.  The public’s price signal for the former is rarely uncertain while for the latter it is far noisy.
We hypothesize that the resulting risk in the portfolio and returns to political capital investment impacts election results.  One important finding in the project thus far is that both risk and return predict election outcomes: when the government reduces risk and achieves a higher return, it gets a better electoral outcome. An interesting twist, consistent with claims about voter learning in the representation literature, is that the electorate in retrospect rewards governments for taking on risk.  When the public is uncertain about its policy priorities and price signals are noisy, the government gets a delayed reward for prescience in its policy emphasis.
In addition to the paper that Peter will present in Dublin on Thursday, we are writing a book-length manuscript over the summer.

[1] There is, of course, no political market where voters go continuously to the polls with high turnout and assess individual policies. This is arguably the central difference between the study of politics and of economics. However, we claim that citizens can express opinion that we measure through frequent polls. Governments endeavor to learn such information and take it as a price signal for its policy assets. With that information, sometimes noisier than others, government makes investment choices.



Measuring Latent Concepts in Public Management

I just returned from the Public Management Research Conference in Syracuse — a wonderful event.  My USC PhD students Jennifer Connolly (2nd year) and Dyana Mason (1st year) presented preliminary results from an ongoing project that develops longitudinal, survey-based, agency-level measures of concepts used widely in public management research between 1998-2010.  The project’s goal is to provide data that inspire a wide range of cross-agency studies.  One example is job satisfaction.  The following chart shows our measure for a sample of federal agencies.

It is notable, for instance, that job satisfaction in the Department of Education fell steadily in the aftermath of the 2001 “No Child Left Behind” legislation, while NASA and the Department of the Interior saw increases in the second Bush administration.

We hope to wrap up the project this summer and will make the data for all measures available upon publication.  We also have measures of perceived bureaucratic discretion, intrinsic motivation, and discrimination and are working on a few others.