The process of local government borrowing to finance the capital needs of social services has an impact on both central-local relations and the type of service which can be offered to the citizen-consumer. Based on an examination of these relationships in the United States, the United Kingdom, France, and Italy, it is postulated that different types of central-local relations are dependent on the nature of relations between central government and the investment community. Further, through use of material from a case study of public housing politics in Italy, it is shown how the investment criteria of the so-called “private” sector are transferred to the operations of the public sector through the mechanism of local borrowing. This transferal affects the manner in which social services are conceived and delivered.
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