PhD defense: Public sector service purchasing

On Friday 14 December 2012 Roar Jakobsen will hold a trial lecture on a prescribed topic, and defend his thesis for the PhD degree at NHH.

11.12.2012 - Ed.

The topic of the thesis is service procurement in the public sector. Jakobsen has examined contracts related to such procurements, in particular how these are followed up by the parties after the contract is signed.

Jakobsen seeks to contribute to the existing research on interorganizational relationships, by testing transaction cost economics predictions in a public procurement context and by adding elements of institutional theory into that framework. He therefore develops a model of relationship governance that highlights efficiency concerns as well as legitimacy concerns.

Building on institutional theory, Jakobsen develops bureaucratic pressure as a new construct for understanding public sector contracting. He argues that such external pressure give rise to formal contract detailing in this context.

The hypotheses were empirically tested on a sample of 310 public sector service purchasing relationships in Norway, Sweden and Denmark. The results yielded mixed support to the hypotheses.

As expected, supplier-held investments motivate formal contracting. Similarly, positive interaction effects were found between formal contracts and supplier-held investments on performance. Thus, central hypotheses outlined from transaction cost economics are supported in this context.

However, transaction cost reasoning does not appear to matter on buyer-held investments. No interaction effects were found, yet the analysis showed direct performance effects of such buyer held investments. Jakobsen finds this result interesting, particularly because buyers are represented by government agencies in this study.

Relational norms were also proposed to strengthen the positive relationships between asset specificity and performance outcomes. However, such results were not found. On the contrary, relational norms were found to have a considerable general impact on relationship performance.

As expected, bureaucratic pressure seem to give rise to formal contract detailing. Thus, this study complements previous research that has described the legitimating role of formalization in other areas of administration behavior.

Theoretical and managerial implications are drawn in Jakobsen's thesis.

Prescribed topic for the trial lecture:
Strategy sensitivity in public sector purchasing in light of transaction cost economics and institutional theory: an analysis of the rationality of existing public contracting practices and implications for possible reforms

Time of the trial lecture:
11:15 - 12:00 in Karl Borch's Auditorium, NHH

Title of the thesis:
Public sector service contracting. Transaction cost economics and institutional theory considerations

Time and place for the defense:
13:15 in Karl Borch's Auditorium, NHH

Evaluation committee:,
Professor Aksel I. Rokkan, NHH, chair
Professor Kenneth H. Wathne, University of Stavanger
Professor Mark E. Bergen, University of Minnesota

Supervising committee:
Professor Sven A. Haugland, NHH, principal supervisor
Professor Arne Nygaard, BI

The trial lecture and thesis defense will be open to the public. Copies of the thesis will be available from: presse@nhh.no