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Markets and Municipalities: A Study of the Behavior of the Danish Municipalities

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  • Christoffersen, Henrik
  • Paldam, Martin

Abstract

The complex pattern of Market Orientation of the 275 Danish municipalities is analyzed. An MO-variable is constructed from a poll covering 12 tasks, where municipalities are free to produce the service or purchase it on the market. Six potential explanations of the MO-pattern are operationalized. Four of those work: (1) MO is a modernization, (2) spreading by diffusion. (3) MO increases if the municipality is under economic pressure. (4) MO stays low if the fraction of the population that depends upon the public sector is large. While stakeholder/pressure group politics thus works, explanations based on ideology/partisanship fail. In the integrated Copenhagen metropolitan area most explanations fail. Copyright 2003 by Kluwer Academic Publishers

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  • Christoffersen, Henrik & Paldam, Martin, 2003. "Markets and Municipalities: A Study of the Behavior of the Danish Municipalities," Public Choice, Springer, vol. 114(1-2), pages 79-102, January.
    • Handle: RePEc:kap:pubcho:v:114:y:2003:i:1-2:p:79-102
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    Citations

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    Cited by:

    1. Peter Kurrild-Klitgaard, 2015. "Classical Liberalism and Modern Political Economy in Denmark," Econ Journal Watch, Econ Journal Watch, vol. 12(3), pages 400–431-4, September.
    2. Wassenaar, M.C. & Dijkgraaf, E. & Gradus, R.H.J.M., 2007. "Contracting out: Dutch municipalities reject the solution for the VAT-distortion," Serie Research Memoranda 0003, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    3. Xavier Fageda & Germa Bel, 2008. "Local privatization, intermunicipal cooperation,transaction costs and political interests: Evidence from Spain," IREA Working Papers 200804, University of Barcelona, Research Institute of Applied Economics, revised Apr 2008.
    4. Andrés Picazo-Tadeo & Francisco González-Gómez & Jorge Wanden-Berghe & Alberto Ruiz-Villaverde, 2012. "Do ideological and political motives really matter in the public choice of local services management? Evidence from urban water services in Spain," Public Choice, Springer, vol. 151(1), pages 215-228, April.
    5. Niklas Potrafke, 2019. "Does Public Sector Outsourcing Decrease Public Employment? Empirical Evidence from OECD Countries," CESifo Economic Studies, CESifo Group, vol. 65(4), pages 464-484.
    6. Jaakko Meriläinen & Janne Tukiainen, 2019. "Public Procurement versus Laissez-Faire: Evidence from Household Waste Collection," CESifo Economic Studies, CESifo Group, vol. 65(4), pages 446-463.
    7. Germà Bel & Xavier Fageda & Melania Mur, 2010. "¿Por qué se privatizan servicios en los municipios (pequeños)? Evidencia empírica sobre residuos sólidos y agua," Hacienda Pública Española / Review of Public Economics, IEF, vol. 192(1), pages 33-58, March.
    8. Elinder, Mikael & Jordahl, Henrik, 2013. "Political preferences and public sector outsourcing," European Journal of Political Economy, Elsevier, vol. 30(C), pages 43-57.
    9. Kurrild-Klitgaard, Peter, 2011. "Kontraktpolitik, kulturkamp og ideologi 2001-2011 [Contract politics, "cultural war" and ideology 2001-2011]," MPRA Paper 43052, University Library of Munich, Germany.
    10. Hans Bonesrønning, 2013. "Public employees and public sector reform implementation," Public Choice, Springer, vol. 156(1), pages 309-327, July.
    11. Henrik Christoffersen & Martin Paldam & Allan Würtz, 2007. "Public versus private production and economies of scale," Public Choice, Springer, vol. 130(3), pages 311-328, March.
    12. repec:elg:eechap:15325_19 is not listed on IDEAS
    13. E. Dijkgraaf & R.H.J.M. Gradus, 2008. "How to Get Increasing Competition in the Dutch Refuse Collection Market?," Springer Books, in: E. Dijkgraaf & R.H.J.M. Gradus (ed.), The Waste Market, chapter 0, pages 101-109, Springer.
    14. Germà Bel & Xavier Fageda, 2009. "Factors explaining local privatization: a meta-regression analysis," Public Choice, Springer, vol. 139(1), pages 105-119, April.
    15. Henrik Christoffersen & Martin Paldam, 2004. "Privatization in Denmark, 1980-2002," CESifo Working Paper Series 1127, CESifo.
    16. Germa Bel & Xavier Fageda, 2008. "Reforming the local public sector: economics and politics in privatization of water and solid waste," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 11(1), pages 45-65.
    17. Germa Bel & Anton Costas, 2006. "Do Public Sector Reforms Get Rusty? Local Privatization in Spain," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 9(1), pages 1-24.
    18. Anders Villadsen & Jesper Hansen & Niels Mols, 2010. "When do Public Managers Imitate Each Other? Mimetic Decision Making in Contracting Decisions of Danish Municipalities," Public Organization Review, Springer, vol. 10(4), pages 357-376, December.

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