Should Government Go It Alone or With a Partner? A Comparison of Outcomes from a Work Release Program Using Different Policy Tools

• Date: 01 July 2018
• Published date: 01 July 2018
• DOI: http://doi.org/10.1111/puar.12948

Public Administration Review,

Vol. 78, Iss. 4, pp. 545–555. © 2018 by

The American Society for Public Administration.

DOI: 10.1111/puar.12948.

Should Government Go It Alone or With a Partner? A Comparison of Outcomes from a Work Release ProgramUsing Different Policy Tools 545

Research Article

Robert J. LaLonde (1958-2018), who

died on January 17, 2018 following a long

illness, was a leading scholar in the fields

of labor economics, econometrics, and

program evaluation. He made important

contributions to research on job training,

immigration, costs of worker displacement,

impact of U.S. unions and collective

bargaining, and economic and social

consequences of incarceration.

Deanna Malatesta is associate

professor in the School of Public and

Environmental Affairs, Indiana University

Bloomington. Her research focuses on

public management, contracts, and

governance.

E-mail: dmalates@indiana.edu

Haeil Jung is associate professor in the

Department of Public Administration, Korea

University, Seoul, South Korea. His research

focuses on disadvantaged populations

and related public policy interventions.

Specifically, he has studied male and female

incarceration, obesity, early childhood

education, higher education, public pension,

and contracting out government services.

E-mail: hijk@korea.ac.kr

Should Government Go It Alone or With a Partner?

A Comparison of Outcomes from a Work Release

Program Using Different Policy Tools

Haeil Jung

Korea University

Deanna Malatesta

Indiana University

Robert J. LaLonde

University of Chicago

Abstract: This article compares labor market outcomes from two different approaches to a work release program in

Illinois: direct provision by a government and a purchase-of-service (POS) contract between government and a public

charity. Significantly better employment and earnings outcomes were associated with the POS contract. To better

understand the reasons for the success of the POS contract, the authors further examined the specific terms of the

contract, organizational expertise, and the political context of POS contracts. The results are organized according to

the main theoretical assertions. Findings add to the weight of evidence that contractors, like public charities, can be

valuable government partners for addressing challenging social policies and programs.

Evidence for Practice

• Relational norms complement the written contract to improve contracting performance.

• Commitment to resources and political support may improve contracting performance.

• Public agencies can control contracting through explicit and implicit measures.

Contracting between public agencies and

private providers is not a trendy movement,

but it is a growing and persistent part of

how public agencies deliver services and products

to citizens, not only in the United States but also in

Western Europe and other regions (Cooper 2003;

DeHoog and Salamon 2002; Forrer et al. 2010;

Kelman 2002; Kettl 2000; Savas 2000). It has been

driven by the hypothesis that introducing various

forms of competition through contracting for

services encourages governments to be more efficient,

effective, and responsive to the public (Greene

2002; Peters 1996; Savas 1987). However, some of

the early contract services have been withdrawn by

governments because the benefits of contracting out

are not guaranteed and effective management of the

contracting process is difficult (Moe 1996; O’Looney

1998; Rainey 2003; Warner and Hefetz 2012). It has

been pointed out that there are often thin markets,

which results in a competitive bidding process being

unlikely in local government contracting. This is a

problem not only in the United States but also in

other countries such as China (Girth et al. 2012;

Jing and Chen 2012; Mohr, Deller, and Halstead

2010). Additionally, some stakeholders worry

that contracting out may lead to inefficient and

ineffective results, with potential loss of control and

accountability in public service delivery if public

agencies cannot monitor contractor performance well,

political favoritism becomes prevalent in bidding

process, or there are not enough bidders for public

services (Auger 1999; Breaux et al. 2002; Donahue

1989; Hefetz and Warner 2011; Joaquin and Greitens

2012; Kettl 1993; Moe 1987, 1996; Sclar 2000).

However, there is a notable lack of research comparing

outcomes when the same program is administered

by two different organizations. Moreover, scholars

concede that there is much to learn about the factors

associated with successful contracting. Despite the

research void, U.S. policy makers remain enthusiastic

about using public-private partnerships (e.g.,

Goldsmith and Burke 2009). Among the multiple

forms of contracting between government and

private providers, governments choose a purchase-

of-service (POS) contract when the main goal is

to change the behavior and circumstances of a

disadvantaged group—for instance, to implement

a work release program for prisoners (DeHoog and

Salamon 2002).

This study examines employment outcomes associated

with a POS contract offering a work release program

for prisoner. We also collect, evaluate, and compare

data from a similar program delivered directly by

the Illinois state government. To better understand

the factors that underlie a successful POS contract,

we investigate specific contract terms as well as

the organizational and political contexts. Using

econometric methods, we find that the outcomes