Local institutions and public service outsourcing: Managerial professionalism, mayoral strength, and electoral rules

Abstract This research examines how institutional contexts matter for US municipalities' service outsourcing decisions, deriving data from the ICMA's multiple rounds of surveys concerning local institutions and service delivery choices. We focus on seven pivotal local institutions that address managerial professionalism, mayoral strength, and electoral rules. Moreover, a composite index measuring the general nature of the municipal structure on a political–administrative scale is constructed based on the local institutions examined. The empirical estimations use the existence of initiatives and popular referenda allowing citizen voters to adjust local statutes as instrumental variables for local institutions. We find that municipalities with a council‐manager municipal form, a professional manager, a weak mayor, and nonpartisan and at‐large elections of council members outsource less services. Professional managers can moderate the effects of contextual factors on government outsourcing decisions. Moreover, municipalities with a more political or a less administrative municipal structure outsource a larger portion of services.