Public-Private Partnerships and Cooperative Agreements in Municipal Service Delivery

Abstract

This study uses quantitative and qualitative survey data on the use of public-private partnership in provision and production of public services by municipalities in predominantly rural New Hampshire (USA). Descriptive analysis suggests that town officials are less satisfied with the quality of privatized services, suggesting that privatization involves some tradeoff between costs and quality. These results differ from the experiences of large metropolitan areas and suggest that conclusions of previous research do not necessarily generalize to the challenges faced by small rural communities. Statistical analysis confirms that available fiscal health, geography, and voting patterns are linked to privatization decisions.

Keywords:

• privatization, cooperative agreements, public services

The authors thank participants at the annual meetings of the Northeastern Agricultural and Resource Economics Association and the New Hampshire Municipal Association for helpful comments, Aichatou Hassane for research assistance, and the New Hampshire Agricultural Experiment Station, and the Whittemore School of Business and Economics for financial support. This is Scientific Contribution Number 2324 from the New Hampshire Agricultural Experiment Station.

Notes

1. Numerical benchmarks such as tickets written and arrest rates can encourage overly aggressive police tactics and may create an incentive to underreport actual crimes. As noted by Weisheit and Donnermeyer (2000) rural areas present particularly unique problems with crime statistics.

2. A full set of descriptive results are available from the authors.

3. Some care must be taken with drawing too strong of a conclusion because we have a single snap-shot of time with the survey and do not have evidence of levels of service satisfaction prior to current arrangements.

4. We have also experimented with other specifications for this model, where the dummy variable is interacted with measures of satisfaction. The results are not qualitatively different.