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Party Control, Party Competition and Public Service Performance

Published online by Cambridge University Press:  21 February 2012

Abstract

This article assesses party effects on the performance of public services. A policy-seeking model, hypothesizing that left and right party control affects performance, and an instrumental model, where all parties strive to raise performance, are presented. The framework also suggests a mixed model in which party effects are contingent on party competition, with parties raising performance as increasing party competition places their control of government at increasing risk. These models are tested against panel data on English local governments’ party control and public service performance. The results question the traditional account of left and right parties, showing a positive relationship between right-wing party control and performance that is contingent on a sufficiently high level of party competition. The findings suggest left–right models should be reframed for the contemporary context.

Type
Research Article
Copyright
Copyright © Cambridge University Press 2012

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References

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35 In English local government, the financial year runs from 1 April to 31 March.

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52 The Non-Domestic Rate is a business tax levied that is uniform across England. While local governments collect it, they transfer all of it to a common pool administered by the central government, which then redistributes the funds to local governments according to population.

53 See Arellano, Manuel and Bond, Stephen, ‘Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations’, Review of Economic Studies, 58 (1991): 277–97Google Scholar. A potential problem of this estimator is that, while it is consistent, it may not perform well in samples of limited size, such as ours. One simple check for this is to verify whether the Arellano–Bond estimates of the coefficient on the lagged dependent variable lie between those obtained by fixed effects with a lagged dependent variable, and ordinary least squares with a lagged dependent variable, or at least not significantly outside this range. The rationale for this check is that, in the presence of unobserved heterogeneity, these two estimators are inconsistent. The estimated coefficients on the lagged dependent variable tend to be small in the former case and too large in the latter (see Bond, Stephen R., ‘Dynamic Panel Data Models: A Guide to Micro Data Methods and Practice’, Portuguese Economic Journal, 1 (2002), 141162CrossRefGoogle Scholar, p. 144). In all our models, the range between these two coefficient estimates is indeed large, and all our Arellano–Bond lagged dependent variable coefficient estimates lie strictly between the fixed effects and the OLS estimate. A further check of the estimator is to test for the first-order and second-order serial correlation of the differenced residuals. While their first-order serial correlation should be negative, as it is for all our specifications, the second-order serial correlation should be zero. Due to the shortness of our panel, we cannot test for the latter. Nevertheless, our other checks do not indicate major problems with using this estimator.

54 Our findings on the effects of the three parties on public service performance remain substantively unchanged when previous experience governing the same local government is taken into account.

55 These findings also hold when change to Conservative party control is disaggregated into those observations where the change is from control by another party (four instances) and where the change is from no overall control (thirteen instances).

56 Each instance can be described in full: Plymouth went from Conservative to Labour control in 2003 with CSP rising from 50 to 52. Oldham went from No Overall Control in 2002 to Labour majority control in 2003 with CSP rising from 65 to 72. Sheffield went from No Overall Control to Labour majority control in 2003 with CSP rising from 65 to 73. Finally, Hartlepool went from No Overall Control to Labour majority control in 2004 with its CSP of 87 falling to 82. This conclusion holds when the local performance improvements are compared against the national rising trend on the CSP, Plymouth and Hartlepool being worse and Oldham and Sheffield slightly better.

57 As in Table 3, the findings in Table 5 also hold when change to Conservative party control is disaggregated into those observations where the change is from control by another party (four instances) and where the change is from no overall control (thirteen instances).

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59 Clarke, Sanders, Stewart and Whiteley, Political Choice in Britain; Boyne, James, John and Petrovsky, ‘Democracy and Government Performance’.

60 Whiteley, PaulSeyd, Patrick and Billinghurst, Antony, Third Force Politics: Liberal Democrats at the Grassroots (Oxford: Oxford University Press, 2006)CrossRefGoogle Scholar.

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