Drivers of contracting back in local governments: analysing efficiency, opportunistic political cycles, political corruption and financial factors

Abstract

The main aim of this paper is to examine the likelihood of local governments remunicipalising public services that were previously contracted out. To do so, we studied a sample of 141 Spanish municipalities with between 20,000 and 50,000 inhabitants, with particular reference to contracting back operations conducted in the period 2014–2016, using a random-effects panel logit model. We found that local authorities that contracted back public services were mainly influenced by the wish to achieve higher levels of efficiency, by political behaviour in a pre-electoral year, and by political corruption detected in the previous year.