Aligning Needs and Capacities to Boost Government Competitiveness

Public Organiz Rev DOI 10.1007/s11115-017-0388-0 Aligning Needs and Capacities to Boost Government Competitiveness Tobin Im 1 & Kris Hartley 2 # Springer Science+Business Media, LLC 2017 Abstract National competitiveness indices are often theoretical underdeveloped, limiting their engagement with academic literature. Because many are based on neoliberal ideology, a new approach is needed to incorporate governance and administration theory, and to enhance relevance to developing countries. This article introduces government competitiveness, a concept that recognizes overlooked factors like the role of social organizations, the use of diverse policy inputs and policy development processes, and the imperative to address human needs at all development stages. The conceptual foundation draws from systems theory, needs theory, and intervention stages theory to inform a comprehensive framework that bridges development scholarship and practice. Keywords Government competitiveness . Governance . National development Introduction In the post-Washington Consensus era, national competitiveness (NC) has received increasing attention in academia, but the related empirical agenda continues to be defined and driven largely by development practitioners. Im and Choi (2016) argue that the widely used NC and quality of government (QoG) indices, including those of the World Bank (WB) and World Economic Forum (WEF), lack clear definitions of competitiveness and suffer from weak theoretical support. Indices such as these also fail to provide actionable policy guidance about the diversity of issues impacting * Kris Hartley hartley@u.nus.edu 1 Graduate School of Public Administration, Seoul National University, 151-742 Gwanak-ro, Gwanak-gu, Seoul, South Korea 2 Department of City and Regional Planning, Cornell University, 213 Sibley Hall, Ithaca, NY 14853, USA Im T., Hartley K. competitiveness, instead focusing primarily on items related to Bbusiness friendliness.^ Arguably, these indices have been designed to justify aid-contingent neoliberal reform prescriptions in countries where government practices are seen by external analysts and development practitioners as obstacles to trade liberalization. Consequently, the indices are narrowly focused and ignore broader dimensions of public service – many of which complement development efforts. To support a new logic for governance reform, it is necessary to include factors concerning both human and national development. In measuring progress towards a government’s stated objectives, such empirical modifications should accommodate cultural and historical idiosyncrasies and path dependencies that define governance systems. According to Fukuyama (2013, p. 1), Bthere is very little agreement on what constitutes high-quality government.^ Indeed, the term government is ambiguous in its concurrently collective and executive nature. In the United States, the term Badministration^ is used interchangeably in reference to both politics (e.g. the BObama administration^) and bureaucracy (e.g. the Food and Drug Administration), each a fundamental institution of government. Despite this casual terminological conflation, there is a mature scholarship on the so-called Bpolitics-administration dichotomy,^ beginning with Woodrow Wilson (1887). This dichotomy implies that the bureaucratic function of government should be immune from political interference. Regarding politics, a government system is typically designed to include a mechanism by which public will is measured and interpreted. These concepts form the basis for studies about comparative systems (e.g. democracy), international relations, and ethics and philosophy, among other topics in political science and policy studies. In turn, research about administrative and bureaucratic elements address the operational dimensions of how political will, once determined, is incorporated into policy design and implementation. While the politics-administration dichotomy is not perfectly applicable to most real-world cases, due to inexorable political influence on bureaucratic functions, it has theoretical value in helping scope analytical inquiry and informing the selection of benchmark metrics. While administrative characteristics and functions alone are insufficient to explain government performance, this study’s focus on applied measures emphasizes aspects that can realistically be reformed. Calls to change political systems (e.g. authoritarian dictatorships to democracies) may reflect sound political theory concerning representation and equity, but can lack practical relevance as such systems are often perpetuated through force or coercion. Therefore, measuring administrative dimensions has broader relevance to developing countries because related concepts have little relevance to the political apparatus; in short, they make no comment on political legitimacy. Focusing more on operational than political-structural variables, this approach only identifies needs and justifies interventions at various scales. For example, Lindblom’s (1959) study of incremental change in public policy is situated within the procedural and administrative spheres of government, and describes a policymaking process that is relevant across political systems. While the above argument supports this study’s conceptual approach, the philosophical treatments long dedicated only to the study of politics can also be applied to administration, and this is where much research and practice falls short. Despite their theoretical separation from politics, in practice bureaucracy and administration do not operate outside the normative expectations of the body politic. This proposition has Aligning Needs and Capacities to Boost Government Competitiveness been addressed in the literature through concepts such as new public service (Denhardt and Denhardt 2000), new public administration (Frederickson 1980), and other theories regarding the democratization of bureaucracy; nevertheless, there is scope for incorporating these ideas into the measurement and practice of NC. To distinguish this approach to measuring NC from that of existing indices, this paper describes the concept of government competitiveness (GC).1 Research addressing non-economic elements of NC in comparative context has been excluded from existing indices, in favor of a primary focus on growth-enabling factors. GC aims to fill this theoretical and practical gap. This article begins with a background that reviews the foundations of political theory to explain the purpose and function of government. This is an important first step, as it justifies the particular approach of GC that is missing from other indices. The article continues with an outline of the conceptual provenance of GC, including systems theory, needs theory, intervention stages theory, and their combined role in assessing the scope of government intervention. The article concludes with an explanation about how GC is measured, paying particular attention to how its approach addresses the shortcomings of other indices. In outlining the theoretical underpinnings and methodological details of GC, the article serves as a concept piece to support empirical studies while making a theoretical contribution to what is currently an unsettled literature on the role of government. Conceptualizing Government Governance as a topic has been explored in various forms throughout history, with the theoretical foundations of government activity centered on the relationship among individuals, society, and the rule of law. Early progress on the foundations of public administration emerge from the ancient Persian Empire, which despite its geographic scope and cultural diversity employed a complex and effective administrative state that survived foreign invasions and has influenced administrative design to the modern era (Farazmand 2001). Contributions from Persia, particularly from the early cities of Susa and Elam, include the concept of federalism, systems of multi-level governance, and protocols for inter-jurisdictional diplomacy and coordination. The Medes later refined the concept of the state and its relation to citizens, and developed systems for collective governance and the professionalization of bureaucracy (ibid.). The Achaemenids (559 BCE - 330 BCE), under the leadership of Cyrus the Great, later formed the largest and most advanced bureaucracy of the time to support history’s first Bworld state^ empire; the regime was also known for social equality, humanitarian efforts, and the abolition of slavery through a Universal Charter of Human Rights (337 BCE) thought to be the first of its kind (Farazmand 2002). Administrative and institutional development, including bureaucratic efficiency and merit-based advancement, progressed under the leadership of Cyrus’ successor Darius, who was known also for further institutionalizing the humanistic reforms of his predecessor and improving 1 Due to the ambiguous conceptualization of competitiveness, the term is often used interchangeably with similar concepts, many from research institutes: 1) IMD and WEF focus primarily upon NC, 2) the World Bank’s WGI evaluates Bgovernment effectiveness,^ and 3) Quality of Governance Indicators (QGI) focus on Bquality of governance.^ Im T., Hartley K. many facets of Persian society including trade, culture, rule of law, and infrastructure (ibid.). Scarcely a century later in ancient Greece, Aristotle’s description of the city-state structure (polis) and Plato’s writings about the role of government emerged during a turbulent era of tyrants, oligarchies, and populist revolutions; these conceptualizations of government focused on actors and their interrelationships as prescribed by a code of individual behavior and obligation to society. After this birth of BWestern-style^ Athenian democracy, Roman politician and orator Cicero delivered a series of legal speeches, many as political invectives, that defined a Roman style of government in the first century CE. Cicero’s anti-autocratic philosophy was based primarily on the concept of liberal democracy that had emerged in ancient Athens. During the same period of Western antiquity, concepts of an Asian government philosophy also emerged, significantly but not exclusively grounded in Confucian thought. This model reflects the role of the state as a curator of citizen well-being, justifying a centralized bureaucratic apparatus that makes necessary provisions while maintaining social order and subordinating the individual to the welfare of the collective.2 After centuries of feudalism and violent tribalism in Europe, a Greco-Roman philosophy of politics and citizenship inspired liberal democratic movements that to this day define governance systems in most Western and many post-colonial states. In the Western early-modern era, debates about the role of government focused on both the general purpose and specific roles of government. Enlightenment scholars and political philosophers – e.g. Locke, Voltaire, Rousseau, Hobbes, and Montesquieu – revisited with scientific and empirical reason the question of why society needs a government and the role of the individual therein, establishing the foundational justifications of what became modern Western Bliberal^ democracy. In the later modern era, Woodrow Wilson (1895) offered a more operationally grounded and comprehensive account of government functions, including the maintenance of order, protection of people and property, institutionalization of family relationships, enforcement of contracts, punishment for crimes, and management of relations with external governments, among others. In Wilson’s era, and particularly into the early twentieth century, the study of government and administration turned to these more mundane operational and administrative functions. For example, Frederick Taylor’s (1909) concept of scientific management quickly captured the attention of both scholars and practitioners and was used to justify the measurement and standardization of bureaucratic procedures. These two developments – administrative science and rationalization of procedures – pushed the study of government, previously dominated by sublime concepts like freedom and political representation, towards practical concerns; it also underscored the necessity of separating politics and administration for research purposes. While this dichotomous emphasis on administrative operations versus politics appeared to be liberated from normative concepts about the role of government and its relationship with citizens, the study of administration has not been free from ideological influence. From 1950s to 1970s, research about government capacity explicitly reflected a post-World War II developmental paradigm suffused with a 2 As with the principles of Greco-Roman democracy, Confucian thought survives to the present in both formal practice and societal values. Differences between the two are evident in the performance gaps between Asian and Western countries on governance metrics that largely reflect Western-style democratic priorities. Aligning Needs and Capacities to Boost Government Competitiveness neoliberal Washington Consensus philosophy. The focus of governance reform prescriptions was the promotion of economic development, nation building, and political modernization in impoverished countries (Grindle 2010). Scholars in comparative and development administration concurrently aimed to formulate a general theory of developing country administrative systems. For example, Riggs’ (1963) framework describes prismatic societies in which government functions are diffused and differentiated (political, economic, educational, judicial, etc.), while Heady (1959) argued for an approach to comparative administration focused on structure rather than behavior, which would supposedly broaden reform applications to the variants of democracy found in non-Western countries. These analytical approaches emphasize the environment rather than the government itself, inviting the label Becological theories.^ More detailed examinations of government can be found among theories of the developmental state, including the dominant role of public administration in economic development in Japan and the four Asian Tigers (Korea, Hong Kong, Taiwan and Singapore). Johnson (1982) focused on the interventionist role of the Japanese government, in particular the Ministry of Trade and Industry (MITI), which demystified the seemingly miraculous post-war economic growth of Japan that might otherwise have been attributed to cultural or socially circumstantial factors. Indeed, mercantilist economic expansion periods, such as those of Colbert in France and the reforms of Japan’s Meiji revolution, were enabled by strong governments. Chibber (2002) describes the administrative consistency and directive role of the Korean bureaucracy during the country’s rapid-developmental era. In comparison to Chibber’s Indian case, Korean bureaucracy maintained consistent implementation of development policies. In Chibber’s study of Morocco and Korea, the capacity of government to stimulate economic growth, combined with efficient implementation, was a principal success factor. The Singapore development story likewise illustrates the role of government in generating transformational economic growth. The country evolved from a provincial trading hub into a global financial center in the span of 50 years, due principally to enabling government policies, timely public investment, and an outward economic orientation. Case studies of Asian economic growth after World War II thus became instructive accounts of government intervention in nearly all facets of public life, including not only economic growth but also housing, social welfare, and physical infrastructure. The developmental state resembled in some ways post-war reconstruction programs such as the Marshall Plan, but were perpetuated through the deep embedding of state policy with private corporate actors (e.g. Korea’s chaebols and Japan’s zaibatsu). As such, in Asia a strong history of state intervention persists to this day in ways that Western countries long abandoned; these differing development histories justify in part the renewed litigation of Western-focused competitiveness indices. Towards the end of the twentieth century, the role of government in economic growth came under critical scrutiny and attention on capacity waned amidst skepticism about the perceived inefficiencies of the welfare state – particularly in the context of neoliberalism in the United States and the UK (Clayton and Pontusson 1998). After the mid-1970s, a pessimistic view about the role of government in economic, social, and political development crept into policy and academic circles, as the failure of public sector initiatives such as Lyndon Johnson’s Great Society exposed the supposed folly of government over-reach and inefficiency. Mitchell and Scott (1987) argued that the Im T., Hartley K. growing distrust of government in the 1980s was a crisis of legitimacy, namely a lack of public confidence in the quality of leadership. The neoliberal emphasis on small government and free markets continued into the 1990s, spreading not only among developed countries but also developing countries via conditional aid. Peters (2001) argued that the market-based model of governance was the only serious rival to traditional public administration, Bfavored by contemporary politicians, academics, and probably the public^ (p. 21). The model emphasized the superiority of private sector management practices, including incentives for employee performance and a movement away from rule-based structures and towards freedom and creativity within the bureaucracy. Western countries such as the United States, UK, and Australia adopted reforms inspired by Osborne and Gaebler’s (1992) reinventing government. At its height, the movement portrayed Ba sense of dramatic change, not just tinkering^ (Nathan 1995: 213). Similar anti-bureaucratic skepticism informed the concurrent New Public Management (NPM) movement, which found favor in countries like New Zealand – once an exemplar of public asset divestment and private provision of public goods. At the heart of this concept was a critical view of government inefficiency and ineffectiveness, ultimately informing concepts such as governance (multi-sectoral models of service provision), state capacity, and QoG (Andrews 2008; Grindle 2010; Rothstein and Teorell 2012). Supporters of NPM embraced the philosophy of government as Bsteering instead of rowing,^ implying a comparatively passive or collaborative role; this is reflected in Peters’ (2001) participative government model, which emphasizes employee empowerment and flatter organizational structure. This marked a significant change from decades earlier, when post-war recovery and poverty alleviation were almost solely dependent on government initiatives. Eventually the neoliberal perspective, which had reduced government’s role to establishing and enforcing the Brules of the game,^ was critiqued for lacking theoretical and philosophical substance (Grindle 2010). Beginning in the 1980s, academic attention gradually returned to government and remains there to the present. Amidst this renewed interest in the state, a stream of literature illustrated the importance of institutional studies in examining the role of government (Evans et al. 1985). The new institutional economics literature (E. Ostrom, North, Williamson, Olson, and others) applied market theory to governance issues, offering a competing explanation for development that went beyond the state-corporate polarity. This led to a novel approach for evaluating government capacity and coincided with historic events that underscored the relevance of institutional structure in development management. For example, the collapse of the Soviet Union and Russia’s subsequent economic restructuring towards market capitalism elevated the importance of institutional factors such as property rights and contract law. Exploring this transformation, Fukuyama (2004) and Grindle (2010) argued that the case of Russia owes its significance to government capacity, providing insights for understanding the role of governments in economic development elsewhere (including the Asian Tigers). Despite decades of theoretical exploration, ideological movements, and countermovements, a robust and defensible definition of government roles and capacities continues to elude scholarly consensus. These concepts are only partially defined and serve temporary and fragmented purposes (Nanda 2006). Further, many studies about government roles and capacities have been criticized for various shortcomings. These include the tendency by governments to exhibit market-oriented bias at the Aligning Needs and Capacities to Boost Government Competitiveness marginalization of democratic processes (La Porta et al. 1999), ignorance about economic principles in policymaking (Rothstein and Teorell 2008), the underestimation of institutional diversity (Andrews 2008; Holmberg et al. 2009), and insufficient acknowledgment of the differences between Bgood governance^ and liberal democracy (Gisselquist 2012). These are among the challenges constraining further theoretical development, and are the theoretical gap targeted by the concept of GC. Towards a Theory of Government Competitiveness The concept of GC introduced by this paper focuses on capacities and roles of government in national development, expanding on the use by popular indices of common but narrow measures of economic growth – the apotheosis of which was explained in the preceding section. The primary aim in developing a concept of GC is not to evaluate the performance of a government in static or retrospective ways – as done by many existing indices – but to provide a theoretically and methodologically sound basis for dynamic policy recommendations aimed at improving social welfare amidst the constantly evolving social, economic, and political conditions faced by developing countries. Inclusion of the term Bcompetitiveness^ does not imply that GC focuses exclusively on economic dimensions or that it measures countries principally on the basis of their market functionality. Many indices make reference to the concept of competitiveness in the context of economic growth, with Bcompetitive^ countries boasting pro-business policy orientations and free-market characteristics popularized after the Washington Consensus. Rather, GC takes a broader view of competitiveness unconstrained by the terminology, assumptions, and expectations of Bgood governance^ and Bbusiness friendliness^ indices. In reference to the term Bcompetitiveness,^ GC acknowledges that governments do compete in a global marketplace for investment, talent, and ideas – but this is not the concept’s defining characteristic. The unique contribution of GC is that it goes beyond government abilities to manage or prevent market failures, and accounts for the importance of soft measures like social welfare as indicators of governance and determinants of NC. The competitiveness of a country therefore assumes a higher degree of complexity, justifying the introduction of an empirically intricate and comprehensive approach. As such, GC measures economic aspects but recognizes that their value is in service of broader welfare goals unique to each country. The following quote emphasizes the necessity of taking a broader view of development, and mentions economic growth as an instrument rather than an end. The basic rationale of the human development approach, as we have discussed, lies in the fact that the constitutive elements of human development are closer to the shared human ends than are some of the more commonly-used criteria of progress, such as the growth of GNP per person. In contrast, the importance of GNP growth and related achievements in expanding the means of life lies in their instrumental relevance. Anand and Sen (2000) Im T., Hartley K. GC is defined as Bthe power of government to, in light of various constraints, take resources from in and outside of the country and improve social, economic and cultural conditions of the nation in order to sustainably enhance citizens’ quality of life^ (Ho and Im 2012:13). The concepts of Bconstraints^ and Bquality of life^ can be interpreted flexibly, depending on a nation’s unique setting. For example, the features of a competitive government in a country that lacks natural resources may differ from those of another rich in natural resources. In each country, the attributes of a competitive government vary and their contextual idiosyncrasies can produce divergent perspectives about the scope of government. GC addresses theoretical and methodological questions that receive insufficient treatment in existing indices. For example, should definitions of comparison metrics emphasize only procedures or also substantive policies and outcomes? Should the concept of competitiveness be universally applicable or should it be flexible enough to account for different environments and development paths? Is there a theoretical and methodological approach to measuring competitiveness that is distinct from the liberal and market-based rational choice approach underlying postwar reforms? GC addresses these questions and facilitates an integrated and flexible approach to assessing competitiveness. The breadth of CG’s empirical scope necessitates an examination of both policies and outcomes, as implied by its focus on the improvement of living conditions and quality of life. The attention by GC to aspects of governance that differ across development stages illustrates its flexibility and relevance to developing countries – including those that have not undergone liberal economic reforms. As such, GC is not merely a repackaging of the types of variables typically measured in governance indices emerging from Western-based development efforts and structural adjustment programs. In particular, GC moves away from the concept of competition as a marketbased phenomenon, casting Bcompetitiveness^ as the ability of governments to meet the particular needs of the societies they represent rather than the ability of governments to outpace one another in economic measures. Nor is GC a repackaged version of Bgood governance,^ which according to Farazmand (2004) has been unduly promoted by Western reformers to orient developing country governments towards policies favorable to corporate and political elites. According to Farazmand (p. 6), Bwhat is defined good by the rich and affluent has historically been not so good for the poor, underclass, and masses in less-developed nations.^ There is scope for governance metrics that focus not only on income growth but also on outcomes: factors that improve the lives of citizens within the constraints and realities of individual countries. This approach reflects Farazmand’s notion of sound governance, which Btakes into consideration the genuine features of indigenous governance systems that may be at odds or conflict with the globally dominant neo-colonialist power structures^ (ibid., p. 10). The critique of neo-colonialist power structures, as embedded in the twentieth century’s wave of one-size-fits-all neoliberal reform prescriptions, strengthens this article’s claim that government competitiveness provides an alternative methodological and normative approach. Given that such reforms were resisted in some countries and failed to generate anticipated outcomes in many others, the value of a government competitiveness metric independent of developmental ideologies is clear. GC is situated within three theoretical concepts: Eason’s systems theory, Maslow’s needs theory, and stages of government intervention as proposed by the World Bank and applied by Fukuyama (2005). This combination provides the justification for the Aligning Needs and Capacities to Boost Government Competitiveness concept’s approach and grounds it at the intersection of well-established theoretical constructs that each contribute a crucial dimension. Systems theory is necessary to account for both the internal complexities of governments and the external environments in which they operate. Hierarchy of needs theory is incorporated into GC to enable its application to countries at any level of development, with a focus on meeting the needs of citizens. Finally, the incorporation of intervention stages theory is crucial for articulating the dividing line between government and private provision of essential services, and is relevant to many countries where governance responsibilities are increasingly devolved to non-state actors. The combination of these three theories lends theoretical uniqueness to GC by combining the abstract concepts of government functionality (systems), responsibilities (meeting needs), and capacities (intervention). Systems Theory According to systems theory (Easton 1953), a system operates in a dynamic relationship with its environment, receiving various inputs, transforming them in certain ways, generating outputs, and ultimately affecting outcomes. Bertalanffy (1969) extends general systems theory by incorporating systems theories from various disciplines. Although his concept of systems theory is vague, the core idea centers on the interaction between a system and its environment. Bertalanffy’s idea of the movement of anthropy is particularly relevant to discussions of government roles, including selfregulation mechanisms that achieve systemic homeostasis. Accordingly, organisms – the foundational concept underlying general systems theory – do not contain individual elements that exercise free will. Feedback mechanisms and the maintenance of a steady state are based on collective adaptations to environmental forces. Systems theory as used in the natural sciences does not recognize the Bcontrived^ nature of a system, and this limits its applicability to social organizations. Social organizations do not occur naturally; they are products of intention and planning (Kast and Rosenzweig 1972, 455). As such, changes and adaptations can occur from within social organizations, given the presence of free will and the ability to exercise it. Purposeful elements may initiate changes that are difficult to subsume under feedback and steady-state concepts. This conceptualization assumes that government is a system while the nation is the government’s environment – the systemic context. More specifically, and for analytical expediency, government refers in this study to the executive branch. However, the exact boundary of the government as an institution can be ambiguous, depending on a country’s history and the nature of its political and administrative structure. For example, the differing roles of a cabinet in the legislative versus executive contexts complicate efforts to demarcate analytical boundaries. Further, under non-democratic regimes, the three branches of government as typically understood in democratic systems can be captured or controlled by a dictator or authoritarian elements. This study treats the government as a system, focusing on the executive branch and associated bureaucracy. Within this system, it examines a policy initiative as a Bflow unit^ that progresses through policy development stages as input, throughput, output, and outcome (described in the following section). The examination of this progression necessitates a systems perspective. Further, the systemic characteristics of a government as a distinctive entity with legal, social, and institutional dimensions enable a Im T., Hartley K. comparison of its performance with that of other countries. In a more general sense, this lends ease and validity to comparative studies of GC. Hierarchy of Needs Theory To justify the selection of GC’s analytical dimensions, it is helpful to draw from existing theories that support definitions of administrative demand. Maslow’s (1954) hierarchy of needs is one such approach. Maslow argued that an individual holds various needs that are stratified within a continuum from basic to complex. A higher level need appears only after the previous need is fulfilled. Ho and Im (2012) apply Maslow’s hierarchy of needs theory to the concept of administrative demand. Given the various social and economic sub-categories of a country’s population, however, determining need can be challenging. In some cases, societal needs are the basic physiological essentials for survival, particularly for a country struggling with widespread poverty. The presence of basic needs in this case does not necessarily imply the absence of higher-level needs, but indicates that policy efforts serving the majority population should target the former. As such, GC reflects a government’s will to prioritize societal needs and ability to satisfy them in a timely and efficient3 fashion. Based on the concept of Maslow’s hierarchy, GC assesses a government’s ability to preferentially address the particular needs of citizens (Ho and Im 2012). In the case of developing nations beset with challenges such as food shortages and security threats, needs beyond a basic physiological level typically fail to receive attention. Governments in such countries have limited resources, so a prioritization of resource allocation (GC’s Binputs^) determines policy attention. According to this approach, a government can be competitive only when a nation’s policy is directed first towards the fulfilment of basic human needs. At this point, according to the application of Maslow’s hierarchy, the next level of needs should be addressed. In this context, Im and Choi (2016) critiqued the millennium goals set by UN in the context of Korea’s development since the 1960’s. Based on interviews conducted with Korea’s older generations, Im and Cho find that the Korean government prioritized policy areas as if Maslow’s theory were literally applied. This is an example of how a government has utilized needs theory in practical policy applications. Intervention Stages Theory Systems theory supports the design of the GC framework, and needs theory justifies its emphasis on social welfare in the context of varying levels of development. The scope of government intervention is introduced to systematize how GC treats the division of tasks between government and private actors. Intervention is often an ideological concern that implies the presence of a crude continuum: statist central planning on one hand and laissez-faire economics on the other. While related debates frequently concern the mechanisms of government intervention (public administration, public management, and policymaking), views about the appropriate scope of the public 3 Operational efficiency is robustly addressed in public management literature, but can also be a dimension of competitiveness in measuring the stewardship of public resources. Related to this point, Coggburn and Schneider (2003) provide a useful examination of the impact of government capacity on policy commitments. Aligning Needs and Capacities to Boost Government Competitiveness domain are often deeply rooted in broader political ideologies. Fukuyama (2005) references a framework based on concepts introduced by the World Bank for evaluating government, classifying functions into three stages; minimal, intermediate, and activist. Minimal functions include national defense, disaster management, and property rights. Environment and education are examples of intermediate functions, while industrial policy and wealth redistribution are activist functions. The framework used by Fukuyama can be merged with Maslow’s hierarchy theory to illustrate the logic of the GC approach. Minimal functions are relevant to basic physiological and safety needs as defined by Maslow. According to Fukuyama, government intervention at this basic level addresses market failures for goods that are necessary for the safe and orderly function of society. When these needs are fulfilled, intermediate functions serve Maslow’s social needs, with government functions maintaining the function of markets and social systems in a way that serves individual welfare. Finally, activist functions address what Maslow labels self-actualization. According to Fukuyama, the government’s role at this stage is a higher order of social provision that concerns broader notions of equality and fairness. Ho and Im (2012) argue that public demand for an aggressive or interventionist role by government arises when intermediate functions are already fulfilled. Under this perspective, the role of government does not end when gross domestic product (GDP) rises. There is a variety of dimensions in which government intervention can help people achieve higher-order goals as described by Maslow. Table 1 summarizes Maslow’s theory with regard to the aforementioned state function. As previously mentioned, a prevailing ideology emerging from the neoliberal era is that the role of government should be limited, and that government should not fulfill individuals’ needs if there are private and non-profit providers willing to perform the same functions. This ideal, however, is often unattainable in developing countries due to the absence of viable and reliable substitute providers. Bozeman (1988) insists that the line between public and private provision should not be based in theories related to Table 1 Tabulation of Maslow and Fukuyama theories Maslow Fukuyama Need Details Physiological needs Food, water, air, sleep Safety needs Function Policy area Details Provision of Law and order, Bpure goods^ defense, property rights, public health, Personal security, economic stability resources, family, health Agriculture, public health, economy Defense, disaster management, environment, Social and selfesteem needs Confidence, achievement, respect Intermediate functions Addressing externalities; Education, regulations environmental protection, consumer protection, pensions, welfare Self-actualization needs Creativity, morality, equality Activist functions Asset (re)distribution; coordination of private activity Culture, high education, research and development, Bgood governance^ Im T., Hartley K. economic or behavioral issues, but rather in public law. Nevertheless, in developing countries the law regarding this separation may be unclear, leaving economic and social systems as the best way to define and contextualize government roles. The market and civil society that exists in most developed countries is not fully established in developing countries. Therefore, it is often unrealistic to assume that non-government actors in many developing countries are capable providers for needs at various levels of the hierarchy. In one sense, the government is the only responsible and legitimate actor to execute various functions, until the free market system and civil society reaches a critical level of maturity. Government therefore retains its role of fulfilling functions critical to public order and safety, according to the needs outlined by Maslow. When the market and civil society reach a point where they are fully viable, alternative forms of governance can begin to perform some functions of government that are important for serving human needs. GC makes no normative judgment about the ability of or efficacy with which the private sector can be trusted to serve such needs. It does, however, acknowledge that market failures are common in developed countries, resulting in additional tasks for government (regulation, creation of markets, and provision of public goods, etc.). Government failures are also common in developing countries, constraining the effectiveness of the public sector and thereby social and economic outcomes. The argument that the scope of non-government provision increases with developmental progress is a theoretical one; evaluating whether the private sector is effective at generating positive outcomes through provision for human needs is not within the scope of this article, as the degree of this effectiveness is particular to each country context and can vary across time. Fig. 1 illustrates the relationship between the government’s role and other actors as national income grows. A non-competitive government does not appear only in developing or transition countries. Lack of GC can be also a problem for developed countries, as evident in Fig. 1 Scope of government intervention Aligning Needs and Capacities to Boost Government Competitiveness Greece during the 2015 fiscal crisis. Nevertheless, concepts of competitiveness based on experiences from developed countries tend to have an ideological bias. For example, current ideas about GC are beginning to replace the Washington Consensus ideal (Rothstein and Teorell 2012), which argued that economic growth could be achieved by delegating powers to markets through deregulation, property rights, and privatization (Serra and Stiglitz 2008). This neoliberal approach to economic growth is proving not to be a panacea, particularly for developing countries. The role of the government is not necessarily limited by a lack of tools and resources. However, many studies and development prescriptions have recommended reform practices copied from other countries, assuming transferability from one context to another. Ho and Im (2015) doubt the applicability and appropriateness of resultsoriented reforms, which have been conceptually supported mainly by developed country experiences and frequently applied to developing country contexts. Such reforms emphasize the development of institutional learning capacity followed by the introduction of Western style results-oriented reforms. Overlooked is the fact that developed and developing countries differ significantly in terms of capacity constraints, institutional culture, micro-macro institutional consistency, and development path. Thus it is necessary in both research and practice to account for the uniqueness of governments and their social contexts before benchmarking them. The following framework is an effort towards this end. Theoretical Framework To establish a GC framework, it is necessary first to define the tasks of government for the purpose of measurement. For this study, government activities are divided into four stages: input, throughput, output, and outcome. This concept builds on decades of policy process and stages theories. 4 The stages theory, first introduced by Lasswell (1951), regards policymaking as a sequential process with a logical order of tasks, each fulfilled before the next is undertaken. In general, the stages are chronological and include variants of agenda setting, policy formulation, deliberation and decision making, implementation, and evaluation. This analytical approach has received criticism for being too simplistic, and according to Sabatier and Weible the stages approach saw the height of its popularity in the 1970s and 1980 before being marginalized with the emergence of competing theories. More recent policy theories expanded the scope of analysis to include contextual factors influencing the policy process from outside government. Kingdon and Thurber (1984) explore the influence of public ideas, focusing events (Birkland 1998), and political conditions on agenda setting, the earliest stage of the policy process. Kingdon and Thurber’s multiple streams approach has been used to explain policy change in a variety of contexts, including European emissions trading schemes (Brunner 2008), United States foreign policy (Travis and Zahariadis 2002), national health insurance in North America (Blankenau 2001), and policy implementation in Africa (Ridde 2009). The focus on external actors is also a prominent feature of Sabatier and Jenkins-Smith’s (1999) advocacy coalition framework (ACF), which describes how groups with shared 4 See Sabatier and Weible (2014) for a useful summary of these theories. Im T., Hartley K. interests elevate their agendas to official policy consideration. This framework has been applied often to environmental and social policy dynamics, including stakeholder analysis in marine policy in California (Weible 2007), forest certification programs in Sweden (Elliott and Schlaepfer 2001), drug policy in Switzerland (Kübler 2001), and smoking policy in Japan (Sato 1999). Typically, these types of governance issues involve a variety of stakeholders with varying degrees of policy influence, elevating the relevance of coalitions and interest groups and justifying ACF as an analytical tool. Other policy change theories include Baumgartner and Jones’ (2010) punctuated equilibrium, which describes policy change as a product of shock events that interrupt periods of policy stability, and Yang and Hsieh’s (2007) framework for studying external political contexts and stakeholder involvement. In each of these frameworks, there is a focus on either agency or process, providing a conceptual precedent for GC efforts to broaden analytical dimensions. The four-stage framework proposed for GC is a combination of the above; the overall architecture focuses on process, while the emphasis on contextual particularities accounts for the many actors and agents influencing policy. The stages element implies the presence of a Bflow unit,^ in this case a policy initiative. Inputs include all factors necessary to generate policy: information, analytical capacity, resources, and the Btools of government^ for translating agenda items and ideas into policy options. Throughput represents a government’s capabilities in transforming inputs into outputs. Output includes policy and the peripheral elements that facilitate its implementation (enabling factors such as delivery mechanisms, institutions, and capacities). Outcomes relate to the normative goals of a particular society, namely how policy outputs generate living conditions desired by the body politic. The outcome can also be narrow in scope, such as economic growth for which the government regulates or facilitates markets; many NC indices stop at this stage. GC also focuses on throughput, emphasizing the policy development process more than policy substance. As such, the approach fundamentally enlarges the breadth of policy spheres that can be measured, and this is one way GC differs from other indices. In recognizing the dynamics of the four stages, the GC approach contextualizes government activities within the opportunities and constraints arising from external factors. By contrast, other measures (e.g. the QoG indicators produced by the Swedish Institute) are limited to outcomes; the latter approach focuses on one dimension and largely overlooks pre-implementation stages and related internal operations. Output refers to the immediate products of government activities, and new policies are the outputs of greatest relevance to GC. Output can vary with the same resources, depending on the effectiveness of a government’s conversion functions (e.g. decisionmaking and implementation processes). The policy implementation dimension of throughput is an important factor in generating outputs and outcomes, and is based on a mature literature.5 Conceptually, outcome differs from output in that the former is a broader concept; it indicates how well a government’s activities fit with the needs, priorities, and overall function of civil society and markets. Thus, the effectiveness of outputs, regardless of their fit and quality, is assumed to vary depending on actors and conditions external to the government. Policy outputs are only one determinant of 5 See Matland (1995) for a useful review of the implementation literature from a top-down versus bottom-up perspective. Aligning Needs and Capacities to Boost Government Competitiveness outcomes, complicating analytical efforts to identify the relationship between the two and raising the issue of endogeneity. Further, while outputs or outcomes are of greater interest to policymakers and the public than are inputs (reflected by the particular focus on outputs by existing indices), evaluating GC without considering inputs compromises its usefulness and overlooks significant determinants of competitiveness. For example, QoG is limited by its exclusion of clear input variables as described by GC. Regarding outputs that a government produces at a given stage of development, more theoretical clarification is needed. The issue is whether there is a single dominant need in a society on which government efforts should focus; this again may vary across cases and time. Figure 2 describes the circular relationship between administrative context and the administrative system that transforms ideas into outcomes. The context (left) includes social, technological, and natural factors that determine administrative need, and also includes the support apparatus enabling the system to function efficiently. The system schematic (right) represents the four-dimensional administrative environment described above. Outcomes of the system feed back into social, technological, and natural contexts, and the cycle perpetuates. This figure is necessary to classify variables and order relationships among them, enabling a systematic analysis of GC. Measuring Government Competitiveness Based on the theoretical framework introduced above, this article concludes by outlining a set of GC indicators. Like other measurements, GC must satisfy validity, reliability, and efficiency requirements as analytical tools. Validity refers to the degree to which indicators represent what GC intends to measure. Theoretically, GC aims to capture the core aspects of the broad suite of dimensions defining a country’s NC. Reliability – specifically the degree to which the findings are replicated if the evaluation is repeated with the same tools – is an important characteristic in establishing the validity of GC. Efficiency refers to the various costs of evaluation. Each of these is Fig. 2 Administrative context and the cycle of ideas to outcomes Im T., Hartley K. constrained by the lack of availability and validity of information and data, in particular for most developing countries. For example, certain statistics such as GDP are potentially inaccurate due both to inadequate processes for collecting data and to political efforts to control information. For several reasons, more precision is needed in delineating the boundaries and levels of analysis regarding competitiveness indices. First, existing indices rarely discuss levels of analysis and therefore move indiscriminately across them. Absent a discussion about levels of analysis, it is unclear whether the term Borganizational behavior^ addresses how an organization behaves as a system or the behavior of individual elements within it (Kast and Rosenzweig 1972: 455). Many competitiveness indices use differing levels of analysis including society, government as a whole, central government, bureaucracy, local government, and government departments and agencies. Aggregating all organizations and systems into a single analytical unit can conceal nuances among a nation’s multiple governance bodies and thereby compromise analytical validity. Accounting by GC of these multiple levels of government adds complexity to the analysis but is necessary to understand the many determinants and sources of NC. Second, many competitiveness indices are informed by experiences in developed countries. It is uncertain whether these indices are appropriate for discussing GC in developing or less-developed countries. Thus, these indices fail to provide defensible policy remedies for developing and less-developed nations. GC accounts for contextual idiosyncrasies pertaining to particular governance dimensions, improving its global applicability and its comparative value. Third, the presence and maturity of democracy influences the elements of GC that are able to be measured. Regarding government function, the degree to which policy objectives are interpreted and fulfilled is a key component of GC. Charron and Lapuente (2010) demonstrate that, over time, democracy affects quality of government but is negatively related to government effectiveness in newly democratic countries. On the other hand, democracy is instrumental in guaranteeing government effectiveness when it has a longer history in a particular country (Charron and Lapuente 2010). In tracing changes within the function and role of government, particularly in the context of development, time is an important consideration. GC’s focus not only on the present but also on a historical perspective seeks to account for this important dimension. Fourth, aside from the political and economic factors explored above, the comparison of countries for indices and rankings is complicated by numerous other factors. For example, consideration of geography and space is significant in fully understanding GC. Tropical regions and cold regions face unique environmental conditions. Demographic factors such as population density and racial diversity are also relevant to GC, as are socio-cultural differences. For example, dominant religions and values in Western countries differ from those of non-Western countries. Finally, administrative traditions derived from cultural and institutional characteristics are a major factor determining GC. The existing competitiveness indices are limited because they evaluate a diverse set of countries using largely uniform metrics and assumptions. For GC, government budgets are a common source of input data. Distinguishing data used for outcomes from that used for outputs is an important task, due not only to data scarcity (particularly for less developed countries) but also to theoretical weaknesses in causality. For outcomes, GC also includes data beyond economy-related Aligning Needs and Capacities to Boost Government Competitiveness measures, such as indicators of human development (e.g. health, education, and softer measures of social welfare). GC selects policy areas based on theoretical understandings of government functions and reliability of sources. By accounting for differing experiences and policy practices between developed and developing countries, GC focuses on particular fields of government activity relevant to the unique development context of a given country. This effectively provides a mechanism for comparing countries clustered by similarities. Conclusion Emphasizing the importance of government in enhancing NC, the World Bank, the QoG indicators, and others have developed widely recognized indices and evaluation metrics. Despite making significant contributions, they have theoretical and methodological shortcomings – including an undue focus on neoliberal ideology at the cost of fully understanding progress in social welfare. This article has proposed a theoretical basis to overcome these limitations. Supported by theories in the fields of public administration, psychology, and political science, the GC approach emphasizes broader measures of competitiveness, national-level contextual uniqueness, and practical applicability. Further, the concept of GC underscores the need to account for divergent contexts between developed and developing countries, thus providing support for substantive and actionable policy guidance suited to unique social and economic circumstances. Future research will operationalize GC by describing particular sets of variables and weightings appropriate to countries clustered by developmental characteristics. 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Public Administration Review, 67(5), 861–879. Tobin Im is a professor at Seoul National University’s Graduate School of Public Administration and director of Center for Government Competitiveness. Professor Im earned a B.A and a MPA at Seoul National University in Korea and completed a doctoral degree in Sociology from L‘Institute d‘Etudes Politiques de Paris. He has served as president of Korean Association for Public Administration. His outstanding researches were awarded by Korean Association for Policy Sciences(1997), Korean Association for Public Administration (2007), American Review of Public Administration (2016), and Seoul National University (2017). His research and teaching areas of interest include organizational theory, public management, and comparative administration. In an effort to create an Asian model of public administration, he is author of Public Organizations in Asia (Routledge). His current research concentrates on his concept ‘Government Competitiveness)’ zooming on his research question how to apply the ‘time’ and space concept to various realms of public affairs. Kris Hartley is a Lecturer in Public Policy at the University of Melbourne, School of Social and Political Sciences. He is also a Nonresident Fellow for Global Cities at the Chicago Council on Global Affairs and research affiliate at several institutes, including the Center for New Structural Economics at Peking University, the Institute of Water Policy at National University of Singapore, and the Center for Government Competitiveness at Seoul National University. In the 2016-2017 academic year, Kris served as a Visiting Lecturer in the Department of City and Regional Planning at Cornell University, where he taught quantitative methods and public sector economics. Kris has also held academic appointments throughout Asia, including the University of Hong Kong, Vietnam National University, Seoul National University, the University of the Philippines. Kris focuses on collaborative governance and policymaking in the context of economic development, urban planning, and environmental management. He holds a Master’s degree from UC Berkeley and a PhD from the National University of Singapore.