This article examines the question of why state governments choose to privatize goods and services. After reviewing the literature, to explore the question, the authors devised their own model of state privatization. Although the existing literature describes in great detail the benefits and disadvantages of privatization at all levels of government, it does not address why governments privatize. Using the Clean Water State Revolving Fund (CWSRF) program, the authors test their model of privatization use by state government using political, economic, and administrative variables. They find support for political and cultural influences and state economic conditions as explanations for why privatization is chosen as an option by state governments.
Get full access to this article
View all access options for this article.
References
1.
Auger, D.A. (1999). Privatization, contracting, and the states’ lessons from state government experience. Public Productivity & Management Review, 22(4) 435-454.
2.
Bacot, H.A., & Dawes, R.A. (1997). State expenditures and policy outcomes in environmental program management. Policy Studies Journal, 25(3), 355-370.
3.
Bibby, J.F., Cotter, C., Gibson, J., & Huckshorn, R. (1990). Parties in state politics. In V. Gray, H. Jacob, & R. Albritton (Eds.), Politics in the American states (5th ed., pp. 66-113). Glenview, IL: Scott Foresman.
4.
Bowman, A.O.M., & Kearney, R.C. (1988). Dimensions of state government capability. Western Political Quarterly, 41, 341-362.
5.
Chandler, T., & Feuille, P. (1991). Municipal unions and privatization. Public Administration Review, 51(1), 15-22.
6.
Donahue, J. (1989). The privatization decision: Public ends, private means. New York: Basic Books.
7.
Elazar, D.J. (1984). American federalism: A view from the states. New York: Harper & Row.
8.
Environmental Protection Agency. (1984). Study of the future federal role in municipal wastewater treatment. Washington, DC: Author.
9.
Feigenbaum, H.B., & Henig, J.R. (1994). The political underpinnings of privatization: A typology. World Politics, 46(2), 185-208.
10.
Feigenbaum, H.B., & Henig, J.R. (1997, Winter). Privatization and political theory. Journal of International Affairs, 50(2), 338-355.
11.
Ferris, J., & Grady, E. (1986). Contracting out: for what? with whom? Public Administration Review, 46(4), 332-344.
12.
Freeman, M.A. III. (1990). Water pollution policy. In P.R. Portney (Ed.), Public policies for environmental protection (pp. 97-150). Washington, DC: Resources for the Future.
13.
General Accounting Office. (1992). Water pollution state revolving funds insufficient to meet wastewater treatment needs. Washington, DC: Author.
14.
Goggin, M.L., Bowman, A.O.M., Lester, J., & O’Toole, L.J., Jr. (1990). Implementation theory and practice: Toward a third generation. Glenview, IL: Scott, Foresman/Little Brown.
15.
Heilman, J.G., & Johnson, G.W. (1991). State revolving loan funds: Analysis of institutional arrangements and distributive consequences. Final report submitted to the U.S. Geological Survey, Department of the Interior, Auburn University, AL.
16.
Heilman, J.G., & Johnson, G.W. (1992). The politics and economics of privatization: The case of wastewater treatment. Tuscaloosa: University of Alabama.
17.
Henig, J.M. (1985). Privatization and decentralization: Should governments shrink? Public Policy and Federalism, 2, 26-53.
18.
Henig, J.M. (1990). Privatization in the United States: Theory and practice. Political Science Quarterly, 104(4), 649-669.
19.
Henig, J.M., Hamnett, C., & Feigenbaum, H.B. (1988). The politics of privatization: A comparative perspective. Governance: An International Journal of Policy and Administration, 1(4), 442-468.
20.
Hodge, G.A. (1999). Competitive tendering and contracting out rhetoric or reality? Public Productivity & Management Review, 22(4), 455-469.
21.
Johnson, G.W., & Heilman, J.G. (1987). Metapolicy transition and policy implementation: New federalism and privatization. Public Administration Review, 47(6), 468-478.
22.
Johnson, G.W., & Watson, D. (1991). Privatization: Provision or production of services? Two case studies. State and Local Government Review, 23(2), 82-89.
23.
Kettl, D.F. (1988). Government by proxy: (Mis)managing federal programs. Washington, DC: CQ Press.
24.
Kettl, D.F. (1993). Sharing power public governance and private markets. Washington, DC: The Brookings Institute.
25.
Kingdon, J.W. (1984). Agendas, alternatives, and public policies. New York: HarperCollins.
26.
Kolderie, T. (1986). Two different concepts of privatization. Public Administration Review, 46(3), 285-291.
27.
Landis, J. (1938). The administrative process. New Haven, CT: Yale University Press.
28.
Lester, J.P. (1994). A new federalism? Environmental policy in the states. In N. Vig & M.E. Kraft (Eds.), Environmental policy in the 1990s (2nd ed., pp. 51-68). Washington, DC: CQ Press.
29.
Logan, C.H. (1987). The propriety of prisons. Federal Probation, 51, 35-40.
30.
Logan, C.H. (1990). Private prisons: Cons and pros. New York: Oxford University Press.
31.
Long, J.S. (1997). Regression models for categorical and limited dependent variables. Thousand Oaks, CA: Sage.
32.
Megginson, W.L., & Netter, J.M. (2001, June). From state to market: A survey of empirical studies on privatization. Journal of Economic Literature, 39(2), 321-389.
33.
Moe, R.C. (1987). Exploring the limits of privatization. Public Administration Review, 47(6), 739-777.
34.
Morris, J.C. (1997). The distributional impacts of privatization in national water quality policy. Journal of Politics, 59(1), 56-72.
35.
Morris, J.C. (1999). Was Reagan federalism good for business? Privatization and administrative capacity in the state revolving fund program. Southeastern Political Review, 27(2), 323-340.
36.
Ostrom, E., Schroeder, L., & Wynne, S. (1993). Institutional incentives and sustainable development: Infrastructure policies in perspective. Boulder, CO: Westview.
37.
Raffel, J.A. (1999). Privatization and contracting managing for state and local productivity. Public Productivity & Management Review, 22(4), 430-434.
38.
Sabet, D.M. (2001). Privatization, private sector participation, and improving the water and sanitation sector. Paper presented at the 2001 Southern Political Science Association meeting, Atlanta, GA.
39.
Savas, E.S. (1987). Privatization: The key to better government. Chatham, NJ: Chatham House.
40.
Sharp, E.B. (1990). Urban politics and administration: From service delivery to economic development. New York: Longman Press.
41.
Sundquist, J.L. (1984). Privatization: No panacea for what ails government. In H. Brooks, L. Liebman, & C.S. Schelling (Eds.), Public-private partnership: New opportunities for meeting social needs (pp. 303-318). Cambridge, MA: Ballinger.
42.
Tannenwald, R. (1999, July/August). Fiscal disparity among the states revisited. New England Economic Review, 3-24.
43.
Wallin, B.A. (1997). The need for a privatization process: Lessons from development and implementation. Public Administration Review, 57(1), 11-20.
44.
Werkman, J., & Westerling, D. (2000). Privatizing municipal water and wastewater systems promises and pitfalls. Public Works Management & Policy, 5(1), 52-68.
45.
Wright, G.C., Erikson, R.S., & McIver, J.P. (1985). Measuring state partisanship and ideology with survey data. Journal of Politics, 47, 469-489.
46.
Yager, E. (1999). Politics and privatization decisions in four American cities. Politics, 12(2), 81-87.
47.
Zahariadis, N. (1995). Markets, states, and public policy. Ann Arbor: The University of Michigan Press.
