Voice or Public Sector Management? An Empirical Investigation of Determinants of Public Sector Performance based on a Survey of Public Officials

Abstract:     
Drawing on an in-depth governance micro-survey of public officials within a country, we address empirically the question of the relative importance of the various determinants of governance. We investigate the causes of poor governance, and show that commonly made inferences about policy based on simple correlation can be highly misleading, because the high correlation between the various governance (and public sector management) determinants, as well as the endogeneity in these variables. We find that undue emphasis may have been given in previous work to a number of conventional public sector management variables (such as civil servant wages, internal enforcement of rules, autonomy of agency by fiat, etc.), while undermining the priority due to more 'external' (to public sector management) variables, such as external voice, transparency, and politicization. The latter set of 'voice'-related variables has larger affect on the quality of service and corruption than the more traditional public sector management type of variables. Further work drawing in depth on country-specific surveys in other settings is warranted to ascertain with more confidence whether a shift towards more prominence to transparency and 'voice'-type of variables is needed, backstopping the results for Bolivia in this paper.

Keywords: Governance, corruption, public officials, policy, public sector management

JEL Classifications: C32, C42, C81, H32, P16, H4, O17

Working Paper Series