Performance measurement: a remedy for increasing the efficiency of public services?

Purpose - Promoters of performance measurement are convinced that performance measurement can greatly contribute to an efficiency boost in the field of public services. The purpose of this article is to treat this as a hypothesis and examine this hypothesis from various theoretical perspectives. Design/methodology/approach - After some introductory remarks dealing with terminology, the article examines the potential offered by performance measurement and performance-based contracting for increasing the efficiency of public service delivery. As a framework for this investigation, several theories are used in order to obtain a theory-driven answer. Findings - The majority of the theories applied are sceptical about the assumption that performance measurement will act as an efficiency driver. All in all an ambivalent picture prevails. Research limitations/implications - Further research is required into the factors which ensure that performance measurement will function as an efficiency driver for public services. Also, the empirical basis which investigates the relationship between performance measurement and efficiency is, up to now, very slim. Originality/value - This paper looks into the chances of performance measurement - a central plank of new public management - as an efficiency driver. That performance measurement contributes significantly to an increase in efficiency is often articulated in official documents. This belief is treated throughout the paper as a hypothesis. The chances performance measurement may offer are examined from various theoretical angles. On a theoretical level, the paper contributes to obtaining a clearer picture of the potential performance measurement may offer.