Organizational slack in subsidized nonprofit institutions

Informal objectives of managers next to the formal objective of the organization can be a source of organizational slack or X-inefficiency in nonprofit organizations. If the organization is subsidized the donor can restrain organizational slack by choosing an appropriate subsidy system. Four subsidy systems are discussed: output, input, revenue and lump sum subsidy. Output subsidy reduces slack most. The ranking of input subsidy compared with lump sum subsidy depends on the elasticity of demand for output. Revenue subsidy equals input subsidy. Changes in the subsidy regime for residential adult educations in the Netherlands turn out to have been inconsistent.     

The Role of Slack in Local Government Finances

The research presented here adopts an organizational approach to develop three regression models that examine why local governments accumulate slack in the form of unreserved fund balances, and what is the impact of slack resources on local governments' short‐term fiscal conditions and decisions about spending and revenues. Using data on Chicago suburban municipalities and their governments, the first model estimates the effects of long‐term and short‐term conditions (fiscal and governing) on unreserved fund balances. The second and third models examine the impact of slack resources and other factors on year‐end deficits or surpluses and changes in spending and own‐source revenues. The results show that ending balances, expenditures (size), and long‐term fiscal conditions have the greatest effect on fund balances, and that slack and current fiscal conditions have the greatest effect on ending balances and changes in revenues and spending.     

Beyond 5 Percent: Optimal Municipal Slack Resources and Credit Ratings

Local governments tend to keep large amounts of slack financial resources to hedge against risk and uncertainty. To date, there has been little empirical research on whether those slack holdings are inadequate, adequate, or perhaps excessive relative to those risks and uncertainties. I address this gap in current research by using credit quality as a criterion to consider “optimal” slack resource levels. I find that for a national sample of local governments, slack resources’ effect on credit quality is statistically but not substantively significant. Having some rather than no slack increases, the likelihood of receiving a more desirable rating by 5–9 percent, but large slack holdings have little if any additional effect. These findings have implications for future work on slack resources, and for debt management broadly.     

Budget Slack,Institutions, and Transparency

Economic theory suggests that it is optimal for governments to use precautionary saving as a countercyclical tool. However, the availability of surplus funds often triggers political pressure for tax cuts and spending increases. Mechanisms for alleviating that pressure include limiting the transparency of slack resources and limiting politicians’ discretion to use slack resources for purposes other than stabilization. This article investigates the extent to which these two mechanisms are substitutes. In particular, the authors examine whether the widespread adoption of budget stabilization funds (BSFs) in the U.S. states over the past several decades has been accompanied by a decline in conservative revenue forecast bias. Using panel data from 47 states over a 22‐year period, they find that the adoption of a BSF reduces revenue underestimation by approximately two‐thirds; however, the size of the effect depends in part on how much a state saves in the BSF and the rules governing BSF deposits and withdrawals. The results suggest that BSFs have the unintended effect of increasing fiscal transparency.     

Fiscal slack or environmental pressures: which matters more for technological innovation assimilation? A configurational approach

Abstract

Prior studies suggest that fiscal slack may positively affect technological innovation in the public sector but yield inconsistency between theoretical expectations and empirical findings. To address this research gap, this study develops a configurational explanation combining fiscal slack and environmental pressures by employing fs-QCA in the context of Chinese provincial governments’ online public service provision. The findings reveal that the role of fiscal slack is environmentally dependent on explaining technological innovation and that environmental pressures seem to be more important. That is, fiscal slack is likely irrelevant to a high degree of technological innovation assimilation, while the demanding environments of multiple environmental pressures matter. Relative fiscal scarcity may be somewhat relevant to a low degree of technological innovation assimilation only when combined with a more relaxed environment. Several theoretical and practical implications are discussed.     

The Effects of Political and Fiscal Incentives on Local Government Behavior: An Analysis of Fiscal Slack in China

This study examines the determinants of fiscal slack from the perspective of Chinese local government officials. Given China's rapid economic growth over the past 30-plus years, Chinese local governments reportedly hold huge slack resources that attract public scrutiny. In an effort to improve their fiscal performance, some localities recently established budget stabilization funds, following a top-down initiative. However, it remains unclear to what extent fiscal slack has accumulated and which factors affect slack resource levels of Chinese local governments. By employing a panel dataset (249 prefecture-level cities, 1999–2009), this study finds that political and fiscal factors exert significant influence over local officials’ decisions about slack resource levels. The findings of the study bear implications for establishing fiscal rules and improving the performance of sub-national governments in China and other countries.     

Bureaucratic choice and nonoptimal provision of public goods: Theory and evidence

Local governments' allocation decisions are modeled in the context of a slack maximizing bureaucrat who produces public goods according to a production function that includes both provision and the constituents' socio-economic characteristics. To gain a better understanding of the determinants of slack, comparative statics and an empirical study of Illinois municipalities are conducted. The indirect output distance function provides efficiency scores upon which we regress several variables, representing socio-economic characteristics, costs and competition measures. We find that slack or inefficient behavior is associated with richer communities, lower education levels and a lack of competition for residents among municipalities.     

Fiscal Slack and Counter‐Cyclical Expenditure Stabilization: A First Look at the Local Level

There is a rich literature on how state governments use slack fiscal resources—most often in the form of rainy day funds and budget stabilization funds—to minimize the effect of economic downturns. This paper presents the first known examination of whether slack resources have the same counter‐cyclical effects at the local level. It uses a panel data set to determine whether one particular form of local fiscal slack, general fund balance, stabilizes current annual expenditures among a sample of 103 Minnesota cities from 1990 to 2000. The findings suggest different fund balance portions have marginal but nonetheless important effects on expenditures.     

激励机制：防止党员干部精神懈怠的路径选择

当前党员干部中存在的“精神懈怠”现象表现出根源性、隐蔽性、传染性和差异性特征,严重影响了党员干部的思想观念、工作作风及工作能力。精神懈怠现象产生的原因是多方面的,必须多策并举、辨证施治。根据组织行为学的“激励”理论,完善党员干部工作中的激励机制将是一条行之有效的治理举措。具体地说,应以内激励增动力,通过理论创新、教育灌输和文化熏陶等,建构共产党人先进的精神、理想和信仰体系,培育并形成自强不息、昂扬向上的精神动力,促使党员干部不想懈怠;以外激励加推力,通过制度保障、群众参与和科技推动等,形成激励与约束共存、管理与监督并重的良性环境,促使党员干部不能懈怠;以正激励添引力,顺应人的正当的精神和物质需求,采取满足、促进和奖励措施,促使党员干部不愿懈怠;以负激励增压力,通过严格问责、严肃惩戒,形成对党员干部潜在惰性的强大威慑,促使党员干部不敢懈怠。     

Public Service Motivation,Organizational Social Capital,and Knowledge Sharing in the Korean Public Sector

This article investigates whether public service motivation (PSM) and organizational social capital predict knowledge sharing in the public sector. The hypothesized relationships in the proposed model are verified with the online survey data of 506 public employees in Korea. The test results show that the two dimensions of PSM (attraction to public service and commitment to public values) and the trust component of organizational social capital are both positively related to knowledge sharing in the Korean public sector, and that the associability component of organizational social capital is indirectly associated with knowledge sharing through its influence on PSM. The article discusses the ways that PSM and organizational social capital may contribute to overcome the social dilemma of knowledge sharing in public organizations. It also suggests that there is need for further research on the individual dimensions of the PSM construct.     

Legislative systems with absolute party discipline: Implications for the agency theory approach to the constituent-legislator link

This paper examines how the presence of absolute party discipline forces one to re-examine some of the issues surrounding the constituent-legislator link. With absolute party discipline, slack at the individual district level is determined by the policy choices of a political party, rather than by the choices of the individual legislator. This party discipline not only has implications for the representational effectiveness of individual legislators, but also results in the terms “slack” and “shirking” no longer necessarily being synonymous. The empirical work shows that Canadian political parties engaged in wide scale shirking on the 1988 U.S.–Canada Free Trade Agreement.     

Governmental participation and the organizational adaptation of Green parties: On access, slack, overload and distress

Abstract.  This article explores the reciprocal links between the organizational transformation of Western European Green parties and their governmental experience. On the one hand, a series of hypotheses with regards to the possible link between prior organizational adaptation and eventual access to governmental participation are examined. On the other, the opposite question is addressed: that of the potential impact of governmental participation – and, more recently, exit from government – on further organizational adaptation. Following both a qualitative and a qualitative comparative (QCA) analysis, one ultimately identifies a link between prior organizational adaptation and eventual access to government, but a much more indirect and contrasted link between governmental participation (and exit from government) and further organizational adaptation.     

Corporate social responsibility commitment of small‐to‐medium enterprises and organizational competitive differentiation: Stakeholder pressure,market orientation,and socioeconomic context effects

This paper aims to examine the role of stakeholder pressure and market orientation in explaining the corporate social responsibility (CSR) commitments and the organizational competitive differentiation of small and medium enterprises. The socioeconomic context, that is, favorable versus unfavorable, was used as a moderator in above links. The results verify the strong influence of stakeholder's pressure on CSR commitments and the influence of stakeholder pressure and market orientation on organizational competitive differentiation. The socioeconomic context confirms to have a significant moderating role in the hypothesized links. In a favorable context, stakeholder pressure turns out to be relevant in explaining CSR commitments and the organizational competitive differentiation, and CSR commitments itself also have a significantly positive effect on organizational competitive differentiation. In an unfavorable context, market orientation provides a significantly positive support to CSR commitments and organizational competitive differentiation.     

Pulling the Levers: Transformational Leadership,Public Service Motivation,and Mission Valence

This article contributes to our understanding of public service motivation and leadership by investigating ways in which organizational leaders can reinforce and even augment the potential effects of public service motivation on employees’ attraction to the organization’s mission (mission valence). The results contribute to two research questions. First, the findings provide new evidence on the sources of public service motivation. The authors find that transformational leadership is an organizational factor associated with higher public service motivation. Second, the article examines the relationship between transformational leadership and mission valence. The authors find that transformational leadership has an important indirect effect on mission valence through its influence on clarifying organizational goals and fostering public service motivation.     

Downsizing,competition, and organizational change in government: Is necessity the mother of invention?

One answer to the question of why government organizations don't perform better—common in academic “public choice” literature but also in folk wisdom—is that resources come too easily, independent of performance. Some businessmanagement literature suggests that a crisis in resource flows can force successful change—”necessity is the mother of invention.” However, the literature also presents an alternative view: that crisis promotes rigid preprogrammed responses, not new ways of behaving. This paper examines the impact of crisis on organizational change in government by examining an organizational change effort in the U.S. federal government (procurement reform during the 1990s) that occurred simultaneously with an organizational crisis involving workforce downsizing and introduction of competition for some buying offices. Using a dataset consisting of a survey of approximately 1,600 frontline government contracting officials, the impact of variation in crisis at different buying offices on variation in behavior change is examined. Necessity was found to be the mother of invention, not rigidity. However, these effects were counteracted by two negative effects of crisis on organizational change: 1) employee resentment over violation of a “social contract at work” reduced behavior change, 2) employee association of the change effort with downsizing reduced attitudinal support for the change, which translated into reduced behavior change. On balance, crisis inhibited organizational change, rather than promoting it. © 2006 by the Association for Public Policy Analysis and Management     

Board Diversity,Stakeholder Representation,and Collaborative Performance in Community Mediation Centers

Does board diversity or representativeness influence organizational performance? Though it is understudied in both the public and the nonprofit sectors, learning more about this critical subject can enhance organizational performance within highly collaborative settings. Community mediation centers, which rely on multiple public and private resources to meet their programmatic objectives, provide excellent case studies for analyzing the impact of different kinds of interorganizational linkages on organizational performance. A multitheoretic view incorporating agency, resource dependence, and stakeholder perspectives is employed through a national sample and a two‐stage analysis using a logic model to test the cumulative impact of board characteristics and interorganizational relationships on organizational outcomes. Organizations’ collaborative capacity depends on several kinds of boundary‐spanning activities, including network ties, revenue sources, and the number of stakeholder groups represented on the board.     

Organized Grour>Government Relations in Norway: On the Structured Selection of Participants, Problems, Solutions, and Choice Opportunities *

This article reviews the nature of direct interest organizational participation in government in Norway. Organizational involvement, while high, varies markedly across different kinds of associations and issues. Activities are concentrated in the two organizational forms of the committee and remiss systems. The analysis of the linkage patterns with the ministries suggests that corporatism is a somewhat inadequate concept for describing the Norwegian system in general.     

Deadlines,routines, and change

Routines, the habitual and predictable behavior patterns of an organization, play central roles in both maintaining organizational performance and in adapting such performance to changing conditions. Deadlines interact with routines in important ways in influencing the course of organizational adaptation. This paper examines the role of routines and deadlines in influencing change in a regulatory program. It describes the adaptation of routines in the Environmental Protection Agency's (EPA) water pollution and pesticide programs in response to pressures and deadlines imposed by Congress, the courts, and the White House. The programs analyzed offer contrasting glimpses of the effects of routines on organizational change. Routines may be collective and shared by the members of an organization or unique to the specific groups or subgroups within it. When the organization primarily has widely-shared routines, few options will be perceived; consequently, collective routines tend to blunt the impact of pressures for change. On the other hand, routines that become fragmented, diverse, and individual in the face of repeated external pressures may facilitate change.     

Political Pressure,Conformity Pressure,and Performance Information as Drivers of Public Sector Innovation Adoption

Why public organizations adopt and abandon organizational innovations is a key question for any endeavor to explain large-scale developments in the public sector. Supplementing research within public administration on innovation with the related literature on policy diffusion, this article examines how external factors such as conformity pressure from institutionalized models, performance information from other organizations, and political pressure affect innovation adoption. By the use of two survey experiments in very different political contexts—Texas and Denmark—and a difference-in-differences analysis exploiting a reform of the political governance of public schools in Denmark, we find that public managers respond to political pressure. We find no indications that they emulate institutionalized models or learn from performance information from other organizations when they adopt organizational innovations. The results thereby point to political pressure as an important factor behind large-scale adoptions of organizational innovations in the public sector.     

Doing Things Right: Effectiveness in Local Nonprofit Organizations, A Panel Study

This study investigates whether nonprofit organizational effectiveness is judged consistently by differing constituencies and whether changes in board effectiveness and overall organizational effectiveness (judged by differing constituencies) are the result of changes in the use of practices regarded as the "right way" to manage. The results show that different constituencies judged the effectiveness of nonprofit organizations differently, at both periods; that a change in the use of correct board practices over time, controlling for board effectiveness at time 1, was not related to board effectiveness at time 2; and that a change in the use of correct management practices, controlling for organizational effectiveness at time 1, was not related to organizational effectiveness at time 2, except for board members. Implications of the results are considered. Claims about best practices for nonprofit boards and organizations must be evaluated more critically. Finding the right fit among practices is more important than doing things the "right way.