Andreas Bergh
Senior lecturer
What happens when municipalities run corporations? Empirical evidence from 290 Swedish municipalities
Author
Summary, in English
Local governments are increasingly relying on municipally owned corporations (MOCs) to provide public services. Some describe this development as a rational response to austerity challenges and emphasise the cost-efficiency of MOCs (‘the optimistic view’). Others identify complications and associate MOCs with weak supervision, lack of accountability, and corruption risks (‘the sceptical view’). Hitherto, no studies have analysed these opposing claims on MOCs in the one and same inquiry. We address this gap by focusing on Sweden, which has experienced a dramatic growth in the number of MOCs. We examine the association between the number of MOCs, the business climate, satisfaction with local government, local tax rates, and a corruption index for all 290 Swedish municipalities. Putting the ‘optimistic view’ into doubt, results indicate that municipalities relying heavily on MOCs are associated with more perceived corruption and higher taxes but do not have more satisfied citizens nor a better business climate.
Department/s
- Department of Economics
Publishing year
2022
Language
English
Pages
704-727
Publication/Series
Local Government Studies
Volume
48
Issue
4
Document type
Journal article
Publisher
Taylor & Francis
Topic
- Business Administration
Keywords
- arms-length principle
- corruption
- hybrid-organisations
- Municipally owned corporations
- new public management
- quasi-privatisation
Status
Published
ISBN/ISSN/Other
- ISSN: 0300-3930