THE ROLE OF PUBLIC CAPITAL IN THE ECONOMIC DEVELOPMENT PROCESS

This paper reviews the evidence of public infrastructure's impact on economic development. The evidence indicates the marginal net social returns is low. The paper also examines the effect of economic, demographic, and political forces on infrastructure investment. Finally, the literature suggests that improving maintenance and reducing congestion can greatly increase the benefits from the existing public capital stock.     

PUBLIC BUDGETING AND ECONOMIC DEVELOPMENT: EVOLUTION AND PRACTICE OF AN IDEA

One of the major dimensions of public budgeting relates to the generation of growth, employment, and more favorable income redistribution in the economy. This dimension had come to acquire a good deal of importance during the last seventy years. The use of public budgeting for purposes of promoting economic growth, employment, income distribution, has so far been considered as a part of development economics in general, and more specifically, as a part of economic planning. Indeed, such use has been so extensive that it is difficult to consider budgeting for economic development without a consideration of organized economic planning and associated formulation of medium term and annual plans. Planning itself has gone through several vicissitudes during these decades. As an extension, budgeting too has gone through several phases. By 1985, nearly 300 plans were formulated by developing countries. During the same period, the approaches in industrial countries of the west incorporated some elements of organized planning into their budgetary systems. By early 1990s, however, there was a noticeable sense of fatigue with planning. The state which was seen thus far as a solution to market failure, came to be viewed as a major problem in itself, standing between the legitimate aspirations of the community and their realization. Countries, particularly those belonging to the Soviet block, moved away from planning for economic development and came to adopt market friendly policies. In the process, several countries have abandoned formulation of economic development plans. In these countries, there has been a revival, and, therefore, strengthening of public budget as the one and only instrument of economic development conceived, sponsored, funded, and to a significant extent, implemented by the government. Plans, which at one stage had generated the illusion of permanence, proved after all, to be as transient as many other things in the world.     

CENTRAL GOVERNMENT BUDGET PRACTICES AND TRANSPARENCY: AN INTERNATIONAL COMPARISON

From an international perspective, a relationship between public sector transparency and better economic and social outcomes is something that is increasingly acknowledged. In terms of lack of transparency in budget reports both bureaucratic model and fiscal illusion theory have been argued as explanations. To assess transparency in budget practices we analyse to what extent a sample of 41 countries are meeting OECD requirements according to its Best Practices for Budget Transparency document (OBP). We find an average OBP fulfilment of 56.4 per cent. Transparency is negatively correlated with corruption and positively correlated with economic development. Countries receiving external financial and technical support meet fewer OBP recommendations than countries not receiving it. Considering the political framework, both progressive and conservative governments reach similar transparency levels. OECD members do not significantly fulfil more OBP suggestions than non‐members. In respect of 4 variables: transparency, corruption, democracy and development, four clusters of countries arise: top‐performing, low transparency‐developed, low transparency‐developing and worst‐performing.     

FISCAL FEDERALISM, PROFESSIONALISM AND THE TRANSFORMATION OF AMERICAN STATE GOVERNMENT

A combination of political and economic forces have helped to return the states to the centre of the political stage. Whether measured by objective indicators (employment, share of government expenditure, elasticity of state revenues) or political institutional changes (the rise of career governors, the increasing influence of the intergovernmental lobby and the spread of state responsibilities), the states have become increasingly important in the formulation and implementation of American domestic policies. However, these changes have by no means reduced the level of intergovernmental conflict. On the contrary, cuts in federal expenditure, the introduction of block grants and public opposition to increases in state and local taxation are likely to intensify debate on distributional questions at the state level.     

GOVERNANCE AND ECONOMIC DEVELOPMENT: CHANGES AND CHALLENGES

This paper examines the issue of governance in the process of economic development. The paper first provides a literature review on the various arguments regarding the role of government in promoting economic development and the major issues emphasized in recent government reform projects. The paper then focuses on three major policy changes and reforms that are related to the area of governance and economic development: (1) regulatory reform, (2) privatization policy, and (3) decentralization policy. The paper concludes with discussions about the continuing arguments about the role of government, the increasing importance of local governments, and the contribution of nongovernmental or nonprofit organizations in economic development.     

THE SPATIAL LEGACY OF INFORMAL EMPIRE: OIL,THE SOVIET UNION,AND THE CONTOURS OF ECONOMIC DEVELOPMENT IN CHINA'S FAR WEST

Abstract

Beginning in the 1930s, Soviet geologists, engineers, and economic planners began laying the infrastructure of informal empire in China's westernmost province of Xinjiang. Seeking to gain access to its rich petroleum wealth in particular, these Soviet state agents helped create a blueprint for state investment and development in Xinjiang that continues to resonate today. Confronting the substantial Soviet investment in the province and driven by a border policy intent on minimizing capital expenditures for distant peripheries, economic planners in the Republic of China and the People's Republic alike relied heavily on Soviet reports, technology, and infrastructure in their own economic development plans. In the end, the efforts of Chinese and Soviet planners, often working in collaboration, helped create an enduring pattern of state investment in Xinjiang. Focusing on oil extraction, processing, and transport operations in Xinjiang, this work reveals the long-term resonances of informal empire in Chinese border regions.     

THE STATE AND LOCAL GOVERNMENT FINANCE

The 'dual state' thesis provides a useful starting point in analysing the relationship between the central and local state. However the history of reform in local government finance suggests that the dual state approach underemphasizes a number of important features of the relationship. Notably the degree of diversity which exists between the interests displayed by different sectors of the central state, the vertical linkages which exist between national and local levels and the difficulty of pursuing coherent long term strategies in local finance.     

TIME FOR EU MATTERS: THE EUROPEANIZATION OF DUTCH CENTRAL GOVERNMENT

To what extent does the European Union (EU) affect national governments? This article seeks to answer this question by assessing the Europeanization of Dutch central government. Using data from a large‐scale survey among civil servants, we assess to what extent the EU affects the structure and culture of governmental organizations, as well as the activities of individual civil servants. On the basis of this analysis, we conclude that the impact of the EU both on individual civil servants and on organizations in Dutch central government is two‐sided: a small core of civil servants and organizations are deeply involved in EU‐related activities and this exists alongside a much broader base of civil servants and organizations that are less affected by the EU. These differences appear more clearly on the level of daily working practices than on the level of formal organizational structures. Nevertheless, the impact of European integration on government organizations remains limited to particular organizations and particular civil servants within central government.     

LOCAL POLITICAL PARTICIPATION: THE IMPACT OF RULES‐IN‐USE

This article argues that political participation is shaped by locally distinctive ‘rules‐in‐use’, notwithstanding the socio‐economic status or level of social capital in an area. It recognizes that the resources available to people, as well as the presence of social capital within communities, are potential key determinants of the different levels of local participation in localities. However, the article focuses on a third factor – the institutional rules that frame participation. Levels of participation are found to be related to the openness of the political system, the presence of a ‘public value’ orientation among local government managers, and the effectiveness of umbrella civic organizations. Whereas resources and social capital are not factors that can be changed with any great ease, the institutional determinants of participation are more malleable. Through case study analysis, the article shows how actors have shaped the environment within which citizens make their decisions about engagement, resulting in demonstrable effects upon levels of participation.     

THE PROBLEM OF LEGITIMACY FOR THE POST-HANDOVER HONG KONG GOVERNMENT

The much-publicized reversion of Hong Kong's sovereignty to China on July 1, 1997, has been hailed as a success by many. Politically, it has been pointed out that Hong Kong has scarcely changed since the handover. Nevertheless, the alleged successful transition has also witnessed a number of economic, social, and political crises. Drawing on systematically collected longitudinal data of public opinion, this paper tries to answer two important questions: first, has the quasibureaucratic-authoritarian political structure of the post transition government experienced a “legitimation problem,” i.e., a rejection of the political structure as a whole. And second, does social discontent directed at incumbent government officials represent strong bottom-up pressure for faster democratization? The longitudinal data suggest that even when public confidence in the HKSAR government dropped to its lowest level in June 1998, there was no evidence to suggest the quasi-bureaucratic authoritarian system had a legitimation problem, nor was there strong public pressure demanding rapid democratization. The demand for changing the political system has seldom been treated as an important personal concern during the transitional period. While social and economic issues have been of great personal concern for most Hong Kong people, very few of them have demanded democratic changes as a way of restoring confidence. Pressure for bottom-up democratization remains low.     

THE CONDITIONS FOR HEALTH AND SOCIAL CARE POLICY: ROUTINES AND INSTITUTIONS IN THE DUTCH CASE OF NEED ASSESSMENT

By focusing on institutions (rules for action) and routines (patterned behaviour) our intention is to contribute to the understanding of government policy and its outcomes in health and social care. We analysed data to show how the relationship between a new idea for a routine and new rules from the government on the one hand, and existing rules and routines in society on the other, as well as the interaction between rule makers and rule takers (i.e. those who are governed by those rules), have an impact on the change or maintenance of routines. The data concern the case of government policy for need assessment (that is, assessment of needs) in The Netherlands. As our discussion will show, even a national government, however, is not able to completely impose its will on other agents in order to change existing routines. The concept of ‘negotiated order’ helps us to understand why. In the case reported here, the Dutch government and the home care agencies had to exercise give and take, the outcome being a suboptimal result for both.     

MANAGING SOCIAL CAPITAL AND DIVERSITY FOR PERFORMANCE IN PUBLIC ORGANIZATIONS

Managers concerned with the performance of their organizations will exploit available social, administrative, and human capital resources. However, extant theory and mixed empirical evidence leave the effect of social capital on performance unclear. The gains from these norms of reciprocity, participation, networking, and trust may disproportionately benefit only some of their clients, leading to disparities in outcomes among diverse clienteles. We argue that in such contexts, management will put in place policies to counter these disparities. Indeed, our empirical evidence from the management of public education supports the expectation that an institutional commitment to diversity successfully mitigates the uneven effects of social capital on organizational performance. This finding carries important implications for public management and equity in public policy outcomes and may be of particular relevance to management of outcomes relying on co‐production.     

ECONOMIC DISCOURSE AND THE MARKET: THE CASE OF COMMUNITY CARE

The UK government has introduced fundamental reforms into the provision of social care. The'community care'programme, which was fully implemented in 1993, requires local authorities to assess the needs of potential users, to design an individual package of care that reflects those needs, and to purchase the package from a range of statutory, voluntary and private providers. Thus the new arrangement introduced a'quasi-market'in community care, along the lines of those already operating in other areas of the UK public sector, such as health and education. Hitherto, much analysis of the functioning of such markets has been conducted within a neo-classical economic framework. This article examines the relevance to the complex new community care market of three alternative theoretical perspectives: the transaction costs literature, the Austrian school and the new economic sociology. It is concluded that, although neoclassical economic discourse has been influential in shaping policy, no single perspective can capture all the issues relevant to analysing the market in community care. Therefore, in evaluating the reforms, an eclectic theoretical approach will be required which draws upon a variety of economic discourses.     

THE VALUE OF THE REMUNERATION OF HIGH CIVIL SERVANTS IN BRITAIN IN THE 20TH CENTURY AND ITS IMPLICATIONS

The article traces a large real and comparative decline in the rewards of high civil servants in Great Britain over the 20th century, accelerating since about 1970. It relates this to developments in the market for ‘high quality’ graduates and to changes in public and governmental attitudes which have affected the size, organization and role of the civil service. It discusses possible causes of the decline in top rewards in terms of three explanatory approaches suggested by social scientists – the ‘institutional’, the ‘cultural’, and the views of the ‘Chicago School’. Finally, following an examination of changes in the way senior British civil servants are now recruited and remunerated, it considers possible outcomes in terms of effects on the part they can play in the governmental process.     

THEORIES OF LOCAL GOVERNMENT REORGANIZATION: AN EMPIRICAL EVALUATION

Local government reorganization has been widespread throughout Europe in the postwar era. Three broad types of theory have set out to explain this phenomenon in a cross-national context; a welfare state perspective, a functional revolution perspective and a political perspective. The validity of these theories is assessed in the specific context of Belgium. The evidence suggests that none of the prevailing theories can make much headway in explaining the timing and form of reorganization. More promising explanations are to be found through examining broader values, and beliefs and more specific political constellations. The claim or implication that the major local government reorganizations of the postwar era were, in the different countries that experienced it, independent events produced by a common pattern of domestic social, economic or political development has the trappings of scientific theory without its true substance – the ability to explain.     

CONTROLLING LOCAL GOVERNMENT EXPENDITURE: THE CASE OF NORTHERN IRELAND

The purposes of this paper are twofold, namely to outline the basic features of local government finance in Northern Ireland and to discuss how this financial system has been affected by the concerns of central government to control public expenditure. It will be argued that there has been no radical revision of the local government financial system but that central government used traditional methods of moral suasion and capital controls to induce councils to restrict their spending. The reasons for this include the small size of local expenditure and the political risks involved in further curbing local government in Northern Ireland.     

URBAN MANAGEMENT AND LOCAL GOVERNMENT AS NEW INSTITUTIONS IN THE NEW UKRAINE

Local government and modern urban management techniques will play a key role in the transition of Ukraine's institutions from a communist to a free economy and society. This paper provides a historic context for this transition, discusses the problems encountered in building urban management capacities and local government institutions, and explores what it will take to achieve real change.

The paper places the problems of revitalization and rebuilding of these Ukrainian institutions in historical perspective, with special attention to inherited patterns of Soviet administrative culture. The Sovietization of urban planning and administration, and living standards and the creation of nomenklature (the main governmental “human resource”), are analyzed as the starting point for rebuilding Ukraine's local governments. The paper traces the main sources and consequences of “continuous institutional crisis,” such as distrust, corruption, and deterioration of the capabilities of the Ukrainian state. Also examined are the current effects of economic globalization on the development of local and urban governments.

Following a review of Ukrainian “path dependence” and recent difficulties in institutional building, the paper outlines the most important tasks for future development and an agenda for Ukraine's “institutional entrepreneurs.” The paper emphasizes that it is vital to create a professional, rule-based bureaucracy and merit-based municipal civil service.     

TRUTH IN GOVERNMENT AND THE POLITICIZATION OF PUBLIC SERVICE ADVICE

Recent controversies over intelligence in Iraq, to give one example, have raised problems about the politicization of official advice from government, particularly what we are led to believe is factual or ‘objective’ advice. Objectivity is a contested value and the lines are often hard to draw between fact, spin and misrepresentation. Public servants are held to higher standards of objectivity than politicians, a fact on which politicians trade when they seek to attribute assessments of evidence to their officials. The growing openness of government documentation is placing pressure on departmental officials who wish to be both loyal to their political masters and honest in their factual assessments. These issues are discussed with reference to recent Australian experience (and also with reference to the UK Hutton Inquiry into the death of Dr David Kelly.     

A CASE OF PARTIAL CONVERGENCE: THE EUROPEANIZATION OF CENTRAL GOVERNMENT IN CENTRAL AND EASTERN EUROPE

This article compares the Europeanization of central government in four Central and Eastern European countries (CEECs): Estonia, Latvia, Poland, and Slovakia. Using a large N survey of ministerial civil servants, it finds that the Europeanization of central government is characterized by partial convergence. The scope of Europeanization is large and similar among CEECs, reaching widely and deeply into government ministries. Moreover, patterns of Europeanization are similar among CEECs: the same ministries form the ‘inner core’ and ‘outer circle’ of Europeanized ministries; only a small proportion of civil servants work full‐time on EU issues and routinely engage in activities that ‘project’ national policies at EU level. Compared to old member states, patterns of Europeanization show signs of convergence, while the scope of Europeanization is larger in CEECs.     

The Relationship Between State Government Performance and State Quality of Life

Abstract

This article examines the relationship between government performance and quality of life in the American states. We contend that the management capacity of state governments should have direct, tangible impacts on the overall social and economic well‐being of state citizenry. In order to test this idea, we examine the influence of state management capacity (using the 1999 Government Performance Project grades), alongside other economic and political variables, on two prominent measures of state quality of life—The Morgan Quitno “Most Livable State” Index and State Policy Reports' (SPP) “Camelot Index.” We find that both state economic conditions and governmental policy priorities have significant impacts on state performance levels. But, our results clearly indicate that the management capacity of state governments also contributes directly to improving the overall quality of life for state citizens.