Public-sector strategy formulation

Abstract: The public sector encounters challenges in strategy formulation and implementation that are distinct from those faced by the private sector, and these include unique cycles of leadership changes, complex internal and external dynamics, and a variety of stakeholders who have diverse definitions of success and failure. To meet the contingencies generated by these factors, public bodies rely on process timelines based on the election cycle, identifying and focusing on key adversaries and supporters, ongoing communications, and utilizing the opportunities presented by real or perceived crises. In adapting to this combination of circumstances, public-sector managers can profitably draw on both deliberate planning methods and emergent strategies.     

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.     

Parental Kidnapping: A Survey of Left-Behind Parents

Parental kidnapping is examined through a survey instrument developed by Rosemary Farley Janvier. The survey was tested and mailed to 283 left-behind parent victims nationwide; 65 parents elected to participate (a 23% return rate). The survey results yielded a statistical profile of parental kidnappings, with distinct differences between domestic and international cases. The differences were both in gender of the perpetrator and the victims, marital, and custodial status. The circumstances surrounding the kidnappings, use and effectiveness of existing legal remedies as preventive measures, law enforcement, attorneys, and the court?s responses, both pre-kidnapping and post-kidnapping and the emotional and financial costs to the parent victims were assessed. Recommendations by the left-behind parents for prevention of parental kidnappings are offered for legislative changes and procedural changes for the law enforcement community, attorneys, and the judiciary in decisions to be made to ultimately protect children from this trauma through prevention. Special recognition to the staff of the Ocean County Advisory Commission on the Status of Women, Ann Finnegan, Project Coordinator, and Lynn Ross, clerical support.     

Corporate Financial Performance and the Use of Takeover Defenses

This paper tests the hypothesis that the threat of a contested takeover improves corporate performance. This is done by a cross-sectional analysis of listed Danish firms with and without effective takeover defenses. Takeover defenses adopted by Danish firms mainly consist of dual class voting rights often in combination with foundation ownership. Using simultaneous equation estimation to deal with the problem of causation, the results show that unprotected firms do not outperform protected firms. This suggests that management in unprotected firms are disciplined by other corporate governance mechanisms than the market for corporate control, including the legal protection of shareholders.     

Swords have been sheathed but plowshares lack design

Reprinted with permission from The New York Times, Feb. 5, 1992, p. 1.