'Choice of Organizational Form Makes a Real Difference': The Impact of Corporatization on Government Agencies in Canada

Posted: 17 Jul 2008

See all articles by Nancy Bilodeau

Nancy Bilodeau

affiliation not provided to SSRN

Claude Laurin

HEC Montreal - Department of Accounting Studies

Aidan Vining

Simon Fraser University

Date Written: January 2007

Abstract

The new public management includes a portfolio of prescriptions that involve reconfiguring the boundaries of government agencies. One form of reconfiguration is corporatization. Corporatization creates separate agencies that have a contractlike relationship with a ministry or oversight agencies. Corporatization usually comprises a portfolio of changes that attempt to make agencies more "businesslike." Although corporatization is now popular with governments around the world, there is little empirical evidence on its performance impact. This article analyzes 11 corporatizations in Canada by the federal and Québec governments. We first present hypotheses based on principal-agent theory concerning the potential impact of corporatization. For each agency, we compare the behavior and performance for 3 years prior to corporatization to the 3 years subsequent to corporatization. The aggregate results suggest that the introduction of corporatization did alter behavior on a number of dimensions. The results show that output and revenues increased, the revenues-to-expenditures coverage gap narrowed, and cost-efficiency and employee productivity improved following corporatization. Most of these changes were statistically significant.

Suggested Citation

Bilodeau, Nancy and Laurin, Claude and Vining, Aidan, 'Choice of Organizational Form Makes a Real Difference': The Impact of Corporatization on Government Agencies in Canada (January 2007). Journal of Public Administration Research and Theory, Vol. 17, Issue 1, pp. 119-147, 2007, Available at SSRN: https://ssrn.com/abstract=1161796 or http://dx.doi.org/10.1093/jopart/mul014

Nancy Bilodeau (Contact Author)

affiliation not provided to SSRN

Claude Laurin

HEC Montreal - Department of Accounting Studies ( email )

3000, Chemin de la Côte-Sainte-Catherine
Montreal H3T 2A7, Quebec
Canada
514-340-6536 (Phone)
514-340-5633 (Fax)

Aidan Vining

Simon Fraser University ( email )

8888 University Drive
Burnaby, British Columbia V5A 1S6
Canada

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
713
PlumX Metrics