Many contracted-out public services are now being contracted back into the public sector. The author first reviews the conventional economic factors—imperfect contracting market—which can bring pernicious effects to contracting-out. Second, the author proposes 9 noneconomic possibilities which may lead to contracting-back-in by looking into employment relationships, knowledge creation, isomorphism, opposition from unions and public officials, the loss of middle-level managers, political interference, the failure of balancing trust and control, corruption, and the loss of public values. Finally, the author concludes that a holistic understanding of contracting can hardly be developed unless one incorporates and balances economic and noneconomic views.
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