Bringing Services Back In-House: Civic Participation and Inter-Governmental Coordination in Contracting Reversals

• In Event: The Trade-Offs of Contracting in the Public Sector

Abstract

A growing number of governments have recently reversed outsourcing decisions by bringing services back in-house—a shift known as “contracting back-in” (Damanpour et al., 2020; Gradus & Budding, 2020). Scholars have linked this trend to factors such as fiscal stress, administrative burden, and changing approaches to public service delivery (Anna & Stuart, 2007; Bel & Warner, 2015; Girth et al., 2012; Kim & Warner, 2016). While these studies shed light on internal drivers of reverse contracting, the role of external influences remains underexplored.

In particular, civic participation and intergovernmental coordination are two external factors that may significantly shape local government contracting decisions. Citizen engagement can help align service delivery with community preferences, thus increasing public trust and legitimacy (Beth, 2009). Likewise, coordination across government levels can minimize service overlaps and enhance resource efficiency (Gemma et al., 2016). While prior studies—particularly literature reviews (Kim & Warner, 2016) and meta-analyses (Lu & Huang, 2023)—have laid essential theoretical groundwork, there remains a pressing need for empirical research grounded in large-scale data. Such evidence is crucial for capturing the complex and context-specific ways these external forces shape decisions to bring services back in-house (Bel & Fageda, 2009).

To address these gaps, our study examines how civic participation and intergovernmental coordination influence reverse contracting decisions, and how these effects vary with local governments’ resource levels and institutional capacity. Using data from the nationwide Alternative Service Delivery Survey, our preliminary findings highlight the critical role of collaborative governance—particularly citizen engagement and interagency partnerships—in driving decisions to bring services back in-house.

Our research deepens our understanding of reverse contracting by foregrounding the influence of external stakeholders—namely, citizens and intergovernmental partners—in local service delivery. It likewise reveals how these external forces interact with internal administrative conditions, offering a more comprehensive perspective on service delivery choices. For practitioners, our findings provide practical guidance on leveraging collaboration to improve service adaptability, efficiency. and responsiveness, while challenging conventional assumptions about public service contracting.

Authors

• Tangling Pan, Shanghai Jiao Tong University
  Presenting Author

• Yuhao Ba, National University of Singapore
  Non-Presenting Co-Author

• Yifan Chen, Shanghai Jiao Tong University
  Non-Presenting Co-Author