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Transaction Costs Explanations for Proxy Monitoring in Municipal Services Contracting

There is a vast, and expanding, literature concerning public services contracting. This growing body of scholarship often
examines governments’ decisions to outsource service production, as well as the resulting relationships and service outcomes. In the
context of local government outsourcing contract management is becoming increasingly important. Holding vendors accountable for service
delivery and outcomes is essential in an era of third-party governance. Contract oversight, and monitoring, in particular is highlighted
as an essential mechanism. Yet, it is often unclear what monitoring tasks are performed, and who in the contractual relationship is
responsible for these tasks. I theorize that, outsourcing high transaction costs services is associated with greater reliance on proxy
monitoring when compared to direct government oversight. The characteristics of the outsourced service can create a range of
government-vendor relationships, and this is true for monitoring tasks as well. Using data from Florida municipalities I examine the
impact of services’ transaction costs on the likelihood public managers rely on proxy monitoring rather than direct government oversight
for nine monitoring tasks. I use two-stage Heckman selection estimation to analyze an original dataset of municipal services. The results
suggest that, when local governments outsource services that are both asset specific and difficult to measure the reliance on proxy
monitoring for some oversight tasks is greater when compared to direct government monitoring. / A Dissertation submitted to the Askew School of Public Administration and Policy in partial
fulfillment of the Doctor of Philosophy. / Fall Semester 2016. / August 10, 2016. / contracting, contract management, contract monitoring, local government, proxy monitoring / Includes bibliographical references. / Kaifeng Yang, Professor Directing Dissertation; Christopher Reenock, University Representative;
Richard Feiock, Committee Member; Frances Berry, Committee Member.

Identiferoai:union.ndltd.org:fsu.edu/oai:fsu.digital.flvc.org:fsu_405545
ContributorsAnguelov, Lachezar G. (authoraut), Yang, Kaifeng (professor directing dissertation), Reenock, Christopher (university representative), Feiock, Richard C. (committee member), Berry, Frances Stokes (committee member), Florida State University (degree granting institution), College of Social Sciences and Public Policy (degree granting college), School of Public Administration and Policy (degree granting departmentdgg)
PublisherFlorida State University, Florida State University
Source SetsFlorida State University
LanguageEnglish, English
Detected LanguageEnglish
TypeText, text
Format1 online resource (119 pages), computer, application/pdf
RightsThis Item is protected by copyright and/or related rights. You are free to use this Item in any way that is permitted by the copyright and related rights legislation that applies to your use. For other uses you need to obtain permission from the rights-holder(s). The copyright in theses and dissertations completed at Florida State University is held by the students who author them.

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