Does performance information affect politicians’ attitudes to spending and organizational reform?

Performance information systems have been widely adopted by national and local governments. This development has been argued to assist elected politicians in deciding on important questions of resource allocation and organizational reform, potentially creating a system of performance-based budgeting where decision-makers reward high-performers and punish low-performers. Others have argued, however, that politics will continue to undermine these efforts but also that inherent ambiguity of performance information–for instance that low performance signals a need for more resources–makes this unrealistic (Moynihan 2008). Empirically based knowledge of this is limited, however, and existing work relies on case studies or cross-sectional survey data unable to fully control for contextual factors. The aim of this study is to examine the impact of performance information on politicians’ attitudes toward spending and organizational reform. We did this by conducting a randomized survey experiment among all Danish city councillors, in which the treatment group was exposed to a weak information treatment concerning whether their municipality performed above, below, or around the national average within a highly salient policy area. We found, first, that performance information does not have one general effect on politicians’ attitudes but that it depends on the level of performance reported. Second, information on performance both above and below–but not around– the national average leads to attitudes of increased spending, which indicates that lessons from performance information are ambiguous. Third, only high performance makes politicians less favorable to undertaking organizational reform. We discuss the theoretical and practical implications.