The Failure of Theory to Predict the Way Public Sector Organisation Responds to its Organisational Environment and the Need for a Mosaic-View of Organisational Theory

What does theory predict about the way government size and structure adapts to changes in government’s organisational environment (particularly to uncertainty and complexity)? In this paper, we review the theory and evidence from the literature about the way government size adjusts to such changes -- particularly to changes in macroeconomic fundamentals like gross national product (GDP). We find that the traditional theories from the organisational theory literature—like the contingency-based view, resource-based view and the rational choice view -- fail to provide global explanations for much of the variation we see in the world around us. Instead, theorists need to adopt a “mosaic view” of organisational theory -- accepting that different theories may explain the way public sector size and structure responds to the uncertainty and variability in its (macroeconomic) organisational environment. We also provide several empirical hypotheses to test such a mosaic-view. Copyright Springer Science+Business Media New York 2016