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The purpose of this paper is to provide insights into the extent of, rationales for and outcomes of contracting out in the local road and park sectors in Norway. For understanding the use of contracting out in local governments, it highlights the relevance of the capability perspective in organisational literature as an alternative to the standard efficiency perspective.

The paper draws on four expert interviews and survey data gathered from park and road managers in Norwegian municipalities in 2015.

The study suggests that Norwegian municipalities primarily contract out park and road maintenance services when they do not have the capability to perform these services themselves. Cost concerns are also highlighted but of less importance. Moreover, lack of competition renders the use of contracting out as a potentially costly and less satisfying arrangement for organising service delivery.

While the scope is limited to one country, Norway, future research may benefit from the theoretical perspectives, which have been used.

Policy guidelines should support a flexible use of various arrangements for service provision.

The dominating view among proponents of marketisation in the public sector suggests that contracting out to private contractors is undertaken to enhance economic efficiency compared to keeping service production in-house. This study suggests that this is not always the case – even in “most likely” sectors such as park and road maintenance.

The purpose of this paper is to introduce the IJPSM special issue on marketization to clarify the conceptual foundations of marketization as a phenomenon within the public sector and gauge current marketization trends based on the special issue’s seven papers.

Conceptual clarification and cross-cutting review of seven papers analysing marketization in six countries in three policy areas at the level of local government.

Four ideal-types models are deduced: quasi-markets involving both provider competition and free choice for users; classical contracting out; benchmarking and yardstick competition; and public-private collaboration. Based on the review of the seven papers, it is found that all elements in all marketization models are firmly embedded but also under dynamic change within public service delivery systems. The review also identifies limitations and modifications of the four ideal-type models. A key trend is a move towards public-private collaboration and cross-sectorial and inter-organizational governance arrangements.

Continued research on marketization would benefit from development of more fine-tuned theoretical models which are sensitive to the realm of the dynamics within particular policy and institutional contexts.

Policy-makers should balance normative objectives against the experiences gained at the level of implementation.

The special issue shows that marketization still is a concurrent phenomenon which is driving substantial change in public service delivery systems as well as is under dynamic change itself.