Growing the Productivity of Government Services

Growing the Productivity of Government Services

Patrick Dunleavy and Leandro Carrera

Productivity is essentially the ratio of an organization’s outputs divided by its inputs. For many years it was treated as always being static in government agencies. In fact productivity in government services should be rising rapidly as a result of digital changes and new management approaches, and it has done so in some agencies. However, Dunleavy and Carrera show for the first time how complex are the factors affecting productivity growth in government organizations – especially management practices, use of IT, organizational culture, strategic mis-decisions and political and policy churn.

Preface

Patrick Dunleavy and Leandro Carrera

Subjects: economics and finance, public finance, public sector economics, politics and public policy, public policy, social policy and sociology, comparative social policy

Extract

At root, productivity is a fairly simple performance measure. It is calculated as the ratio of all the outputs produced by a given organization divided by all the inputs or the resources used in producing those outputs. In the private sector, the measurement of firms’ productivity, and the analysis of the factors causing productivity growth, have developed a great deal. However, this is not the case in the public sector and for government agencies. The main reason for the lack of reliable productivity estimates for government services has been that public sector outputs do not have a price, unlike those in the market sector, so we cannot use prices to weight the different outputs produced by a given organization. Until the late 1990s this led to public sector outputs being measured by their inputs, that is, by the cost of producing them. This approach was equivalent to assuming that productivity in the public sector is always completely flat and unchanging. Methodological advances since the late 1990s now allow us to estimate productivity ratios for government services by using the costs of producing each type of outputs to weight them. So where a government department does many things, we can now arrive at a useful overall measure of its outputs. In addition, the increasing availability of government services’ activity data in the UK now allows us to compare productivity ratios for different government services, and to begin assessing the different factors that may be systematically related to productivity growth. This book...