Understanding Mixed Forms of Refuse Collection, Privatization, and Its Reverse in the Netherlands

ABSTRACT

Based on panel data for almost all Dutch municipalities, we analyze changes in the mode of service production for refuse collection between 1998 and 2010. We distinguish execution by private enterprises, municipal enterprises, municipal cooperation, outsourcing to neighboring municipalities, and in-house collection. The number of municipalities using mixed forms, such as municipal enterprise, rose as the use of other forms declined, although municipal cooperation only decreased slightly.

In approximately half of Dutch municipalities, the mode of production was stable between 1998 and 2010. In the other municipalities, shifts took place, with two-thirds being towards outside production and one-third towards inside production. Based on a logit model, we find some evidence of an ideological motivation for changing the mode of production. For income, we show that richer municipalities are less likely to change. We also illustrate the robustness of this result to various assumptions.

ACKNOWLEDGEMENTS

The authors would like to thank two (anonymous) referees and participants of the conference “Neither Public nor Private: Mixed Forms of Service Delivery around the Globe” at Universitat de Barcelona, 17–18 May 2012.

Notes

In 1998, this percentage was 96%.

In the Netherlands, municipal cooperation (WGR) can be employed for refuse collection and for other public tasks such as fire brigades (see Bel, Fageda, and Warner 2010). WGRs are regulated by Dutch law.

This cooperation is not run as a WGR.

When municipalities merge into a new municipality, shifts are only included if they take place after the new municipality was installed.

There were 548 municipalities in 1998 and 431 in 2010 in the Netherlands.

Data from 1998 to 2010 are available for 524 Dutch municipalities, and 259 Dutch municipalities (i.e., 49%) shifted to a different mode of production once or more times. In most of these municipalities (163), there was one shift; in 54 municipalities, two shifts took place; and in 42 municipalities, there were three or more shifts.

As a percentage of the total number of inhabitants.

There were local elections in May 1998, March 2002, and March 2006. In almost all Dutch municipalities, at least one election took place. For each political party, we include its votes divided by the total number of votes cast. For subsequent years without an election, we take the results of the last election.

Green Left/Socialist Party: Groen Links + SP; Social Democrats: PvdA; Progressive Liberals: D66; Christian Democrats: CDA; Orthodox Protestants: SGP + CU (in 1998, CU consisted of two parties—RPF and GPV); and Conservative Liberals: VVD.

Note that the unemployment rate seems low, but this results from our definition as a share of total inhabitants, whereas in other definitions the rate is given as a share of the workforce.

To prevent bias as a result of heteroskedasticity, we include population and income in logs.

Results for year fixed effects are available on request.

There are not many large cities in the Netherlands as only Amsterdam, Rotterdam, Utrecht, and The Hague have more than 250,000 inhabitants.

The maximum of this polynomial is exp{0.68/(2 × 0.28)} × 10,000.

We do not include stable municipalities in Tables 4 and 5 as stability was defined over the whole period 1998–2010 (see Table 1).

Detailed results available on request.

These estimations have been carried out following a referee's suggestion.

Detailed results available on request.

These estimations have been carried out at Matthew Potoski's suggestion.

Detailed results available on request.

Color versions of one or more of the figures in the article can be found online at www.tandfonline.com/upmj.

Additional information

Notes on contributors

Raymond Gradus

Raymond Gradus ([email protected]) is Professor of Public Economics and Administration at VU University Amsterdam and Director of the Research Institute for the CDA. In addition, he is a fellow of Netspar (Network for Studies on Pensions, Aging, and Retirement) and Talma Institute for Work, Care and Welfare. He was previously affiliated with the Erasmus University Rotterdam, Tilburg University, and various ministries. His research interests are public administration, industrial organization, social security, and applied public economics.

Elbert Dijkgraaf

Elbert Dijkgraaf ([email protected]) is Professor at the Erasmus School of Economics, where he holds the chair in “Empirical Economics of the Public Sector.” He is also Fellow of the Tinbergen Institute. Elbert is, and has been since 2010, a Member of Parliament for the SGP. His research is organized around empirical economics, public sector economics, industrial organization, competition policy, regulation, and environmental policy.

Mattheus Wassenaar

Mattheus Wassenaar ([email protected]) is Director of Finance & Control at the Dutch Custodial Institutions Agency, and he is affiliated with the Zijlstra Centre for Public Control and Governance at the VU University Amsterdam. His research interests are local government finance, public finance, and public administration.