Factors Influencing Local Service Delivery Choices in Poland

Following a trend towards privatisation, corporatisation and different forms of contracting largely influenced by NPM reforms, we have been witnessing a trend towards a restoration of the control over local public service provision since the early 2000s. No systematic attempts have been made to investigate these trends in Polish local governments. The aim of the paper is to identify the factors determining the choice of a particular form of the provision of local services. The paper verifies the assumptions of the transaction costs concept in relation to the models of coordination of local services adopted by local governments in Poland (we reorganised different alternatives into four service delivery modes in-house, corporatisation, cooperation, contracting out). In this paper, we begin to explore service delivery trends and choices by focusing on water supply, local transportation and home care for elderly people. Changes of the modes of local service delivery towards remunicipalization are one of the dimensions of our analysis. Based on the results of a nationwide survey (CAWI) addressed to all municipalities we test hypotheses derived from the extant literature on service delivery using panel logistic and multinomial logit regression models. The first empirical evidence suggests the more resources a local government can mobilise externally and internally, the greater the likelihood of externalization is. Empirical studies of transaction costs in local service delivery have never been conducted in Poland. Knowledge of transaction costs created by Polish local government system is very poor, and in most dimensions, there are not any previous research results in the subject. In relation to the role of transaction costs generated in the selected modes of service delivery, we verify the assumptions of the transaction costs concept in relation to the models of coordination of local services adopted by local governments in Poland as well as identify factors determining the decision to choose a particular model.