A Comparative Study of the Effects of Institutional Arrangements in Municipal Solid Waste Services in Korea

In Korea, local governments are primarily responsible for providing municipal solid waste services to citizens. This paper examines the effects of different institutional arrangements and characteristics on cost savings, efficiency gains and productivity in the delivery of municipal solid waste services to citizens. In order to carry out this research, a hybrid cost function approach was employed, and cross-sectional time-series data from local governments of Korea covering a ten-year period (2000–2009) were used for empirical analysis. Empirical findings indicated that there were no effects of contracting-out on cost savings, efficiency and productivity gains in Korea. Specifically, the solid waste service costs were not significantly lower under contracting-out than under direct public delivery. In addition, contrary to the arguments of the proponents of privatization or contracting-out, efficiency and productivity gains were actually higher under direct public delivery than when contracted out.     

Toward the usable recognition of individual benefits and costs in regulatory analysis and governance

Regulatory agencies in the United States and Europe have well‐deserved reputations for fixating on the total benefits and costs of proposed and final regulatory actions, without doing any more than anecdotally mentioning the subpopulations and individuals who may bear disproportionate costs or reap disproportionate benefits. This is especially true on the “cost” side of the cost–benefit ledger, where analysts exert little effort to even inform decisionmakers and the public that the costs of regulations might be distributed either regressively or progressively. Many scholars and advocates have observed that regulation can increase the efficiency of market outcomes, but caution about its untoward (or suboptimal) effects on equity. Here, we argue that without considering distributional information about costs and benefits, regulatory policies in fact can also cause violence to notions of efficiency, for two reasons: (i) society cannot hope to approach Pareto‐efficient outcomes without identifying those who must lose so that others can gain more; and (ii) because the harm experienced by involuntary risks and by imposed regulatory costs is likely non‐linear in its magnitude (at the individual level), efficiency is, in fact, a strong function of the shape of the distribution of these effects. This article reviews evidence about the distribution of regulatory costs and benefits, describes how agencies fail to incorporate readily available distributional information, and sketches a vision for how they could analyze costs and benefits to promote more efficient regulatory choices and outcomes.     

Moving to Location Affordability? Housing Choice Vouchers and Residential Relocation in the Portland,Oregon, Region

Abstract

Location affordability measures a household’s combined cost of housing and transportation. Low-income households have the most to gain from housing with lower transportation costs. This research analyzes whether Housing Choice Voucher Program households—participants in a program designed to provide low-income households with a greater degree of housing choice—are able to choose housing that lowers their transportation costs in a metropolitan region with a compact, vital urban core. A mixed-methods approach is used to investigate the differences in location affordability and efficiency among 2,026 voucher recipients who moved within the Portland, Oregon, region during 2012–2013. Location mattered to movers, but in some unexpected ways. Urban movers relocated to less location efficient areas, whereas suburban movers’ location efficiency remained stable. In tight housing markets, voucher holders may be edged out of location-efficient neighborhoods and thus incur increased transportation costs.     

Discounting the benefits and costs of environmental regulations

This paper develops a two-stage procedure for discounting the benefits and costs of environmental regulations that is a variant of the shadow price of capital approach. Under this approach, the capital costs imposed by a regulation are annualized using the marginal rate of return on capital and then both benefits and costs are discounted using the social rate of time preference. This approach yields results that differ significantly from those of conventional discounting when benefits occur with a substantial lag or when benefits are long term.     

Transforming top‐down agricultural extension to a participatory system: a study of costs and prospective benefits in Egypt

This article challenges some previous assessments of agricultural extension relying on simple measures of costs per farmer trained. Taking the case of Egypt, five pilot projects that aim to transform the existing agricultural extension system to a participatory system are analysed as regards their cost‐effectiveness and prospective cost–benefits. It is shown that the intensity and likely impact of participatory approaches among the different projects vary. Hence, it is insufficient to judge extension programmes by their cost‐effectiveness alone. In the case of cotton, for example, the costs per farmer trained are considerably lower than in horticultural crops but there are large differences in prospective benefits which would make investment in participatory extension in the latter more promising. The article calls for a more careful analysis of the costs of extension programmes in agricultural development and identifies four major cost categories, namely base costs, start‐up costs, recurrent and farmers' costs. The article also submits that in the context of the debate on privatization of agricultural extension there is a role to be played for the public sector in agriculture. The success of participatory approaches to extension will depend on the quality of services provided in connection with farmer training programmes. Copyright © 2002 John Wiley & Sons, Ltd.     

A research context for welfare reform

Responsibility for the social safety net continues to “devolve” from the federal to state governments, and many states are now confronting the dilemmas inherent in redesigning welfare—dilemmas that faced Congress, too, as it sought to impose new conditions on receipt of public assistance. This article argues that reforming AFDC is difficult because the public has conflicting goals: putting welfare recipients to work; protecting their children from severe poverty; and controlling costs. For 25 years, reformers have viewed requiring welfare recipients to participate in work-promoting programs as uniquely able to balance these goals. Numerous studies have shown that this approach modestly increased employment and reduced welfare costs. More substantial gains have been achieved by some “mixed-strategy” programs, which stress immediate job entry for some recipients and employment-directed education or training for others. Many people remain on the rolls, however, prompting some policymakers to argue for substituting work-for-benefits or community service work (“workfare”) for welfare after a certain period of time, and others for ending all support. The limited knowledge about work-for-benefits programs suggests that, in contrast to work-promoting activities, this approach ultimately costs money. The research record confirms that there are no easy answers in welfare reform, and that states will have to weigh the trade-offs in considering alternative strategies.     

Managing Markets for Public Service: The Role of Mixed Public–Private Delivery of City Services

The privatization experience of U.S. municipalities shows declining use of complete contracts and a dramatic rise in mixed public–private delivery (joint contracting) of city services. The analysis here shows that city managers have recognized the need to move beyond a simple dichotomy between market delivery and public planning to an approach that balances concerns with efficiency, market management, and citizen satisfaction. The New Public Management stresses the importance of competition and efficiency, transaction costs economics emphasizes the challenges of contract management, and New Public Service assigns primary concern to citizen engagement. Nonetheless, city managers see the need to balance all three. The analysis shows the evolution of a middle position where city managers integrate markets with public delivery and give greater attention to citizen satisfaction in the service delivery process.     

Policy analysis: A conceptual base for a theory of improvement

The purpose of reason or rationality in the analysis of resource allocation decisions is to provide decision makers with guidance on policy decisions which result in improvement, i.e. a net increment in social welfare. The difficulty with what might be called the microrationality of cost-benefit analysis and cost-effectiveness analysis as conventionally practised is that unless the context of such rationality is established in the larger framework of what might in turn be called the macrorationality which reflects an awareness of the properties of the whole system, the policy analyst cannot know whether his recommendation will upgrade (constitute an improvement in) or degrade (constitute a deterioration in) the system as a whole. The paper attempts to suggest a first conceptual approach, and an implied research agenda, addressed to developing a more effective general context for policy analysis. The suggested approach has four major components; first, the establishment of the basis for policy analysis in the explicit specification of a general weighted objective function for national policy and a corresponding set of functions for particular programs and projects; second, the development and incorporation in cost-benefit and cost-effectiveness analysis of a set of analytical parameters which establish the basis for policy analyses which are in the first instance comparable, and in the second instance consistent with the national objective function; third, the development of a general analytical framework for cost-benefit and cost-effectiveness analysis which recognizes the essential interdependency of policy decisions, including the financing implications of expenditure policies; and, finally, the explicit recognition of the need for a criterion of overall system improvement in the development of an analytical framework for the measurement of the trades-off or opportunity costs between alternative policy mixes.     

Appropriation, violent enforcement, and transaction costs: a critical survey

This paper focuses on the extension of transaction costs to appropriative activity and coercive power in the property rights approach. It has been argued that including the costs of appropriation and violent enforcement in transaction costs is based on the assumption that Coaseian bargaining can be extended to any institutional scenario, i.e., voluntary as well as coercive exchange. However, voluntary transactions cannot capture the logic of coercive power. This means that the assumption of an efficient political market is not valid, and that the ??political Coase theorem?? lacks the logical consistency to provide a cornerstone for political theory.     

Nudging Early Reduces Administrative Burden: Three Field Experiments to Improve Code Enforcement

In the past decade, public sector organizations around the world have worked to simplify administrative processes as a way to improve user experience and compliance. Academic evidence on administrative burden supports this approach and there is a strong body of research showing that learning costs, compliance costs, and psychological costs help to explain why residents do not always take up programs for which they are eligible. This article considers the role of these types of costs in a different set of resident-state interactions: compliance with regulations. We present the results of three large field experiments aimed at improving resident compliance with municipal housing codes using targeted behavioral interventions. We find that contacting property owners earlier, redesigning first notices, and proactively communicating with previous violators, can significantly improve compliance by 14.7 percent, 3.3 percent, and 9.2 percent, respectively, with costs savings ranging from 6 to 15 percent of a city's annual enforcement budget. Our results counterintuitively suggest that sometimes adding steps to an administrative process can reduce the costs associated with the resident-state interaction.     

Perceptions,fear, and economic loss: an application of prospect theory to environmental decision making

Most of the analysis of costs associated with the introduction of risky prospects has concerned contingent costs amenable to insurance programs. An important missing element is the current cost associated with changes in uncertainty. These costs are not amenable to insurance plans and require compensation in order to prevent transfers. In a novel approach, this paper develops an application of prospect theory to such questions, in an intergenerational context. The importance of such an application is demonstrated in a case study of the high-level nuclear waste repository (HNWR) siting decision. As a case study, the costliness of obtaining some elements of the analysis leads to a simulation approach, comparing prospect costs at the three sites that were under consideration by the U.S. Department of Energy. Finding that such costs can be large, we argue for a reassessment of current risk analysis approaches. On a policy note, on the basis of the prospect cost analysis here, the choice of the Yucca Mountain, Nevada, HNWR site seems ill-advised.     

The benefits and costs of the Section 8 housing subsidy program: A framework and estimates of first‐year effects

This paper provides estimates for a comprehensive set of social benefits and costs associated with the federal Housing Choice Voucher ( Section 8 ) program. The impact categories for which we provide empirical estimates include the value of the voucher to recipients; additional services and public benefits induced by voucher receipt; improvements in children's health, education, and criminal behaviors; the costs of voucher provision; the labor supply impacts on voucher recipients; and community effects. These estimates rest largely on empirical analyses of the effect of voucher receipt on several recipient and taxpayer behaviors and outcomes that occur in the first year of voucher receipt. The analysis distinguishes benefits and costs accruing to program participants, nonparticipants—including taxpayers and property owners—and society as a whole. Our analysis suggests that the program is likely to meet the efficiency standard of positive net social benefits. © 2011 by the Association for Public Policy Analysis and Management.     

The size of government

Most research on the causes of growth in government expenditure has focused on the demand for government services. In this paper, we argue that in fact this growth may have occurred because of changes in supply. Changes in technology leading to increased specialization and thus increased opportunity costs of self-production have led to increased market production and increased record keeping. Also, female labor force participation has increased. Both of these factors serve to reduce the (efficiency) cost of collecting taxes; if the demand for government spending has not changed, this increase in supply would lead to a larger public sector. We estimate a system of simultaneous equations for the period 1929–1970 incorporating this hypothesis, and the results are consistent with the theory. We are able to explain virtually all of the growth of government; increases in female labor force participation seems to be a very important variable in this explanation.     

Transaction costs and inter‐jurisdictional cooperation: an application to land use collaboration

• The costs and benefits of inter‐jurisdictional cooperation and how these impede strategic alliances among jurisdictions is an issue of growing importance worldwide. The reason is the potential cost savings, efficiency increase and economic development benefits that can be realized through cooperation. The literature has increasingly mentioned transaction costs as obstacles that mitigate cooperation and as a key component of cooperation costs, which must be outweighed by cooperation benefits in order for communities to perceive advantageous strategic alliances. However, a framework is lacking in the literature for evaluating the implications of transaction costs for inter‐jurisdictional cooperation. This paper develops a framework for evaluating the nature and dynamics of transaction costs and their implications for inter‐jurisdictional cooperation, with an application to land use. A simple cost function model is used to explain the costs and challenges associated with managing coordinated, cooperative or consolidated relationships, and the dynamics of such costs. The analysis highlights the importance of such things as degree of complexity, inter‐party diversity and the relative sizes of collaborating partners. An application to land use cooperation in Michigan suggests that policies to eliminate transaction costs could help reduce the barriers to cooperation of various types.

Copyright © 2010 John Wiley & Sons, Ltd.     

Optimally Allocating Federal Money to Cities

The purpose of this article is to discuss some basic methods for optimally allocating federal money to cities. Optimally allocating in this context means using the quantitative methods of operations research, management science, and related fields in order to allocate federal money to cities in such a way as to (1) maximize benefits subject to a given budget, (2) minimize costs subject to a minimum satisfaction level, or (3) maximize benefits minus costs. The basic methods include (1) allocating by marginal rates of return, which partly relies or statistical regression analysis; and (2) allocating by part/whole percentages, which partly relies on ideas associated with multiattribute utility theory. The basic methods will be illustrated with the example of allocating anticrime dollars to cities, although one could easily reason by analogy to allocation in any subject matter area.     

Party mandate theory and time-series analysis: a methodological comment

In 1990 Ian Budge and Richard Hofferbert published an article in support of “the doctrine of the party mandate”, using evidence from regression analyses relating the content of postwar US party platforms and governmental outputs in terms of yearly expenditure rates. Their approach was severely criticized by Gary King and Michael Laver (1993) but has been maintained by the authors in a subsequent extension of their analysis to include data from Australia, Canada and seven European States. The present article takes issue with both the approach followed by Budge and Hofferbert and the alternative approach recommended by King and Laver. It is argued that the trend problem has not been adequately dealt with and the formalization of the mandate model lacks conceptual consistency. Three major suggestions emerge from the discussion: (1) the formal mandate model should be extended to include a “divergence term” designed to separate positive from negative mandate effects; (2) the analysis should pay closer attention to the parameter restrictions that follow from the theoretical model; and (3) the regression equations should be interpreted heuristically in terms of “cointegration” or “causal-trends” models.     

Revealing information in electoral competition

Electoral competition between two expert candidates may lead to inefficient platform choices. The present paper studies electoral competition between two experts and a third uninformed candidate. The latter behaves populistically. This seemingly useless candidate restores efficiency. The paper then endogenizes information acquisition. If the information acquisition costs are low, then equilibria with (i) three expert candidates or (ii) two experts and one uninformed candidate may arise. There are costs such that the latter equilibrium is the only pure strategy equilibrium in which information is transmitted.     

Sharing the costs of fighting justly

ABSTRACT

Combatants who attempt to obey the laws of war often have to take considerable risks in order to effectively discriminate between legitimate and illegitimate targets. Sometimes this task is made even more complicated by systemic factors which influence their ability to discriminate effectively without unduly risking their lives or the mission. If they fail to do so, civilians often pay the price. In this paper, I argue that to the extent that non-combatants benefit from the attempt to fight justly, and to the extent that wars in which combatants attempt to fight justly can be understood as a system of social cooperation which produces both burdens and benefits, non-combatants have a responsibility to shoulder their fair share of these burdens. Thus, if combatants (and by extension enemy non-combatants) are disproportionately burdened in a conflict, non-combatants ought to take on some costs, for instance in order to reduce the strain imposed on combatants by systemic factors such as the availability and distribution of resources.