Political Ideology and Social Services Contracting: Evidence from a Regression Discontinuity Design

Theoretical perspectives on the ideological influences on government contracting predict that local governments controlled by right-wing political parties will contract out a higher proportion of services than those controlled by left-wing parties. However, empirical evidence on the impact of political ideology on contracting out remains inconclusive. To cast new light on this important issue, the authors apply a quasi-experimental research design to contracting choices in children's social services in English local government. Because local governments in England are largely divided along partisan lines, it is possible to estimate ideological effects using a regression discontinuity design that captures changes in political control at 50 percent of the seats gained in local elections. The regression discontinuity estimates reveal that left-wing controlled local governments exhibit a marked aversion to private sector involvement in service provision and a clear preference for in-house service provision. These results are robust to a variety of alternative specifications.