The Decision to Contract Out City Services: A Further Explanation

This research extends and refines the contracting model recently offered by Ferris (1986). The determinants of contracting out among U.S. cities are examined across service providers (for-profit, nonprofit, and intergovernmental) and by functional area (public works, public safety, health and human services, parks and recreation, and support services). Findings support Ferris' thesis that contracting increases with (1) greater cost savings; (2) more stringent fiscal conditions; and (3) less powerful public service constituency groups. But, variations in his basic model emerge when municipal contracting behavior is analyzed by type of supplier and by functional category.