Org III Final

Rhodes, R. A. W. 1996. The new governance: Governing without government

'Governance' has many uses Rhodes' definition: self-organization networks Hollowed state that resists centralized power; blurs sector distinctions Need new tools to manage these networks.

Cohen, March, Olsen (1972) - Garbage can model

Actors, resources, environments in an organization are like tossing random things into a garbage can and shaking it up. The combinations that come about are largely random and non-rational.

Thaler, Madrian, Battaglio et al

All of these authors address choice architecture and "nudging"

Risk sharing problem

Arises when principal and agent have different attitudes toward risk

Madrian

Behavioral psychology can help inform policy decisions. Incentives can often be more effective than command market decisions

Carnegie School - Simon, Cyert & March

Bounded rationality Satisficing Focus on outcomes rather than process

Herbert Simon

Bounded rationality We make decisions based on the given information. We are rational to the best of our ability. "Satisficing"

Grossman and Hart 1986

Contracts, specific rights, residual rights. Costs related to listing rights completely

Casciaro & Piskorski 1987

Critique of Pfeffer and Salancik, tries to bring Emerson back into the conversation by parsing interdependence into mutual dependance and power imbalance

Pfeffer and Salancik (1987)

Definitive book on resource dependence theory. Constraint absorption - giving the rights to control resources to the dependent actor

Positivist

Describes governance mechanisms that solve agency problems Outcome based contract = goal alignment Principal information high = verify agent behavior

Kettl, Donald F. 2006. Managing Boundaries in American Administration: The Collaboration Imperative.

Due to the nation's political culture and federalism, we should pay attention to boundaries, which are important in administrative processes. Boundaries: Mission; Resources; Capacity; Responsibility; Accountability Public Administrators should make sure that fences (boundaries) don't undermine democracy or performance.

embeddedness

Embeddedness is when organizations have prior ties and strong connections to a third organization within their networks

Feldman and March

Examination of why people want information Reasoning: Orgs incentivise collection of info Info is treated in surveillance mode Info is misinterpreted Symbolizes commitment to rational choice

Bernoulli

Expected utility theory

Olson, Mancur. 1965. The Logic of Collective Action. Boston. Harvard University press.

Explores the concept of collective action and when someone will freeride examines the extent to which the individuals that share a common interest find it in their individual interest to bear the costs of the organizational effort

Coase, Ronald H. 1960. The problem of social cost

Externalities are most often dealt with through bargaining, not taxes or quotas. This requires clearly defined property rights, however.

Formal and real authority:

Formal authority: the right to decide Real authority: effective control over decisions Formal authority is decided by structure but real authority can be delegated to agent

Williamson 1991

Further developed Coase's TCE Markets -- Hybrids -- Hierarchies They adapt to contract law, governance costs, asset specificity

resource dependence

Generally, focus on Mergers & Aquisitions, joint ventures, boards and directors, political action, and executive succession as strategies for lessening resource dependence.

Agency problem

Goals of principal are not in line with goals of agent High costs of principal oversight

strengths and weaknesses of embeddedness

Good: logic that the more ties and mutual "friends" each organization has, the more costly it would be to provoke the other organization, thus creating cohesion and less uncertainty Bad: lead to worse outcomes of organization withdrawal from collaboration. If the level of uncertainty is higher or lower than the expectations of a manager, then embeddedness can lead to massive withdrawal events.

Heinrich, C.J., Lynn Jr, L.E. and Milward, H.B. 2009. A state of agents? Sharpening the debate and evidence over the extent and impact of the transformation of governance.

Governmental control and democratic responsiveness is loosening? Governments exercise limited oversight over "agents of the state" Yet, the organizational structures and incentives created by government play a vital role in quality, efficiency, and effectiveness. Perhaps the hierarchy of government has not changed so much as just the tools available to govern broadly within the hierarchy have expanded.

Coase (1937)

If markets work so well, why do we have firms (organizations)? Transaction costs. There is price required for using the market. However, there are limits to firms, e.g. the costs of organizing.

Hart, Oliver, Andrei Shleifer, and Robert W. Vishny. 2007 The Proper Scope of Government: Theory and an Application to Prisons

Incomplete Contracts "Our theoretical arguments suggest that the case for in-house provision is generally stronger when non contractible cost reductions have large deleterious effects on quality, when quality innovations are unimportant, and when corruption in government procurement is a severe problem." "If contracts are incomplete, the private provider has a stronger incentive to engage in both quality improvement and cost reduction than a government employee has. However, the private contractor's incentive to engage in cost reduction is typically too strong because he ignores the adverse effect on noncontractible quality."

Greve & Zhang

Institutional logics - belief systems that give a rationale for organizational goals and action Coalitions shape which institutional logics are adopted and implemented

Nicholson-Crotty, S. and Nicholson-Crotty, J., 2004. Interest group influence on managerial priorities in public organizations. Journal of Public Administration Research and Theory, 14(4), pp.571-583.

Interest groups have power in influencing managers This power is mitigated through access and perceived power

Foss

Knowledge governance is taken up with how the deployment of governance mechanisms influences knowledge processes, such as sharing, retaining and creating knowledge

Hayek's "use of knowledge in society"

Knowledge is decentralized Planning and control of resources should be decentralized But for this to work and economic coordination to occur, we must ensure separate decisions must be based on similar and complete knowledge Main point: knowledge is necessary for a system to function

McCubbins, M.D., Noll, R.G. and Weingast, B.R., 1987. Administrative procedures as instruments of political control. JL Econ. & Org., 3, p.243.

Looks at principal agent relationship Looks at how principals can control behavior through "oversight" and administrative procedure

Cook, K. S., Emerson, R. M., & Gillmore, M. R. 1983. The distribution of power in exchange networks: Theory and experimental results. American Journal of Sociology, 89: 275-305.

Looks into network point centrality and power dependence relationships Show that network centrality is not a good predictor of real power Power dependence is a better predictor of real power Power-dependence = how much influence one actor has over another

Akerlof, George A. 1970. The market for lemons: Quality uncertainty and the market mechanism

Markets may contain varying degrees of information asymmetry, leading to inefficient or undesirable market outcomes.

moral hazard and adverse selection

Moral hazard = agent behaving in ways not aligned with principal Adverse selection = bad selection

Perry, James and Hal G. Rainey. 1988. The public-private distinction in organization theory; A critique and research strategy.

Much research on this supposed difference has been done. Much is limited by differing theory and lack of conceptual clarity. Various definitions exist, some based on: public interest; public goods and market failures; ownership/funding (think property rights); Future research: What are the public and private influences on organizations? Typology for public-private distinctions

Richard Thaler

Nudging

Verkuil

Outsourcing Sovereignty Given that the people are to maintain sovereignty in a democracy, how do we justify outsourcing and contracting? The agent is becoming further and further disconnected from the principal. The state is being "hollowed out" Government must never outsource inherently governmental functions. The chief function being that of oversight. A-76 and the FAIR act are all attempts at ensuring this happens

Kim and Mahoney 2005

PR define the nature of sanctioned human behavior. PR more fully accounts for cases where inefficient economic outcomes persist. Also better at handling shared-ownership issues. More flexible than TCE or PA, which always leads to a rational/efficient outcome.

Emerson (1962)

Power-dependence relations. The power of A over B is equal to the dependence of B on A. Mutual dependence can be balanced or unbalanced

Kahneman and Tversky

Prospect theory Focus on gain or loss from a certain perspective, not just in general Ex. if into is framed as gain or loss Heuristics investigated the use of heuristics in decision-making; studied the availability, anchoring, and representativeness heuristics

Frederickson, H. George. 1999. The repositioning of American public administration.

Public Administration now has things to say to political science Formation of conjunctions often requires a coordinating hierarchy for formation and maintenance. Metropolitan administrative conjunctions take on a professional representation of polity and seems to have good performance.

Moore

Public values theory: public manager level of analysis - looks at public values like the public sector version of shareholder value, created by high performance

Eisenhardt, K. 1989. Agency Theory: An Assessment and Review. Academy of Management Review, 14: 57-74.

Review of agency theory Agency theory = examines when different parties have different risk tolerances and goals and there is a division of labor. Principal delegates work to an agent

Feldman

Routines dynamics - a process not a thing Both stable and changing

structural embeddedness

Structural embeddedness is organizations having prior direct ties

Assumptions of principal agent problems:

There are conflicting goals between principal and agent There is an easily measured outcome Agent is more risk averse than principal

Dickinson, H., 2016. From new public management to new public governance: The implications for a 'New Public Service'. The three sector solution: Delivering public policy in collaboration with not-for-profits and business

Transition to governance regimes may be more rhetorical than factual. Government is becoming a more complex picture of hybrid forms.

Mechanism:

a specific class of events that change relations among specified sets of elements in a similar way over a variety of situations.

Episodes:

bounded streams of social life (i.e. a specified point in history - very vague on how broad or specific)

Daniel Kahneman

cognitive bias defined availability and representative heuristics

Process:

frequently occurring combinations or sequences of mechanisms

Olson

garbage can model

March and Cyert

it attempts to predict behaviour with respect to price, output and resource allocation decisions. It emphasizes the decision making process.

Andrew, Boyne, Enticott

performance failure Mismanagement and misfortune are causes of org failure

Provan and Milward

public sector organizational networks Networks need to be evaluated for their effectiveness Evaluate networks at multiple levels Stakeholders and interest groups impact networks but strong networks can resist them

Bozeman

public values theory: societal level of analysis, a normative consensus about what rights or benefits individuals should be entitled to

Process tracing -

qualitative data collection method that links or "traces" causal mechanisms from cause to effect. Literally ties pieces of evidence together like a detective working a case.

relational embeddedness

relational embeddedness is organizations having common ties with a third party