11 February 2010

Governing the Tap -- The Review

I wrote this review for h-net:

In Governing the Tap, political scientist Megan Mullin describes and tests her “conditional theory of specialized governance,” i.e., that the effectiveness of special districts providing drinking water, relative to water agencies that are branches of local government, depends on certain conditions (political boundaries, water scarcity, the rate of urban growth, and so on). Her contribution is to weave together two opposing theories of special districts: the “efficiency view” that special districts will be more responsive to local conditions and voter preferences, and the “capture view” that pro-development interests will control special districts, to the detriment of established residents and sustainability. Although she addresses special districts in the United States, I think that the lessons in this book can be applied elsewhere.

This thoughtful book certainly contributed to my understanding of local governance, and how--via case studies--political institutions may produce either “good” or “bad” outcomes. My only quibble is that Mullin leans a little too hard on her statistical analysis in seeking support for her theories.

In chapter 1, Mullin sets the stage, showing how the number of special districts (not just for drinking water) has exploded in recent years, driven by the twin pressures of complex regulations and tight budgets in local governments. She also points out that water management is increasingly driven by governance, not technology, and that “public” consumption of water (as opposed to irrigation or industrial uses) has increased at the same time as per capita consumption of fresh water has flattened out. (I particularly enjoyed her observation that 56, then 69, then 83 percent of people “tried to use less water” even while per capita consumption did not fall [p. 16]; seems they need better feedback.) Both of these observations support her claim that it is increasingly important to understand how special districts work. Mullin sets out her thesis (“special district officials are motivated by the same reelection and policy goals as other political actors,” p. 8), and then proceeds to examine it.

In chapter 2, Mullin describes the two competing theories of special districts. The Metropolitan Reform Theory holds that special districts need to be absorbed into local governments to counter wasteful duplication, regulatory capture, and uncoordinated actions. The Public Choice Theory holds that special districts are going to be more responsive to local needs with respect to water management, without facing the compromises and logrolling common to general-purpose governments. She then reconciles the two by adding the “conditional modifier” that special districts are relatively better at water management when water issues are not so important (i.e., general governments deliver the goods to developers), but that an increase in salience--water scarcity--brings politicians’ attention, at the cost to developers and benefit to citizens. At this point, Mullin also makes a strong assumption, that developers may affect the governance of special districts at their formation, but those districts’ policies in later years. The assumption helps her with later statistical work (she can pretend that reverse-causality--endogeneity--is not driving her results), but I am not buying it--most obviously because there is no reason to think that developers would exert effort to set up special districts and then abandon them. Even in built-out areas, real estate prices (and business income) can depend on continued provision of cheap water.

In chapter 3, Mullin tests her hypothesis that special districts will set water prices more aggressively in “normal” conditions but special and municipal agencies will set similarly aggressive prices in hotter, drier places. It is in the testing of this hypothesis (and those in chapters 4 and 5) that Mullin’s book enters its weakest stage. Besides her numerous assumptions, imperfect data, and complex econometric analysis, there are also her statements “in support of her hypothesis” that violate the most basic rule in econometrics: Thou can only reject thy null hypothesis; thou canst not find support in favor of or prove it. Although I commend Mullin for her good statistical work, she should not make such bold claims “in support” of her hypotheses. More caution and less reliance on tentative statistical relationships would leave her less vulnerable to the easy--and perhaps accurate--criticism that she is managing the model to fit her priors and theory. I feel that this book would be much stronger without these weaknesses, i.e., less econometrics and more qualitative support for her theories.

In chapter 4, she tests her hypothesis that special districts are more likely to charge developers high impact fees when the community is growing more slowly. As above, she strains her empirical work to “support” this hypothesis. Among her numerous assumptions is one howler (p. 93): “The model assumes that growth affects impact fee levels, but not the reverse.” Try telling an economist that demand does not slope down (fall when price rises) and see what response you get!

In chapter 5, she uses the same structure to examine the relationship between noncontiguous political boundaries and cooperation among government agencies, “finding” that special districts are more likely to sell their services when they cannot change their boundaries, and more likely to share costs when they can change boundaries.

Chapter 6 gets us back into interesting territory. It is the longest chapter in the book (fifty pages) and the most enlightening. She goes over four case studies (two in California and two in Pennsylvania), exploring how pro- and anti-growth forces battle over urban expansion. I enjoyed this chapter very much, and Mullin's qualitative analysis does not suffer the overreach we saw in the earlier three chapters. She concludes that multiple boundaries and authorities make it easier for each side to prolong conflict. In all cases, development happened, but at a higher cost and (often) reduced scale. When land and water governance are managed under one roof, the disputes are smaller and shorter, and a middle ground is more likely. This is because insiders “work things out” before outsiders can stick their noses in through media, legal, and regulatory channels.

Chapter 7 concludes, adding notes on climate change and generalizations on others issues for special districts.

This book is a must read for people interested in governance, democracy, or urban growth. Mullin’s hypotheses and discussions of the different forms, actions and impacts of local governance are interesting and thoughtful. They will help the reader understand how things work in practice, and how easy or hard it may be to change them.

Bottom Line: I give this book FOUR STARS (one less for empirical weaknesses).

1 comment:

Eric Perramond said...

Interesting, David. How does this compare to Karen Bakker's work on the privatization of municipal water works in the UK? I'll have to get a copy of this... epp