How do we measure public value?

The concept of public value has become a hot topic in public administration. However there has been a lack of clarity about how to measure the public value that organisations are producing. This brief explores a promising framework and its four key components.

At a glance, Nicholas Faulkner (Monash University) and Stefan Kaufman (Environment Protection Authority Victoria) conducted a review of the literature on public value measurement to identify and evaluate available measures. They identified four components to measuring public value.

What is public value?

In 1995, Mark Moore from Harvard’s Kennedy School posited that the task of public sector managers is to create public value.

Public value refers to the value created by government through services, laws, regulation and other actions. It is produced by public managers successfully navigating a strategic triangle encompassing the following:

• Producing valued outcomes
• Within the constraints of available resources and capability
• In an authorising environment of formal and informal jurisdiction, legal frameworks and mandate.

According to Moore, the aim of managerial work in the public sector is to create public value just as the aim of managerial work in the private sector is to create private value. This is distinct from public values which refer to personal judgements about the social standards, principles and ideals to be pursued and upheld by government officials.

The study

The researchers undertook a systematic review of the literature on public value measurement from 1995 to 2016.

Quantitative, qualitative, and conceptual studies were included if they met the following criteria:

• they proposed a method by which government bodies can measure the extent to which they are generating public value as conceptualised by Moore
• they were published in English in peer‐reviewed journal articles or books.

The initial search yielded 543 studies based on title and abstracts. These were then reviewed against the inclusion criteria and this narrowed the pool to 19 studies.

Dimensions of public value

The studies identified a broad array of public value dimensions, including

• public satisfaction
• economic value – generating economic activity/employment
• social and cultural value –  social capital/cohesion
• political value –  democratic dialogue, public participation
• ecological value –  sustainable development, reducing pollution, waste, global warming
• service delivery  – take‐up, satisfaction, choice, fairness, cost
• financial performance –  revenues, expenditure value for money, efficiency
• non‐financial performance –  efficiency, customer satisfaction, service quality
• social value from the user perspective, tangible economic value from the administration perspective, intangible economic value from the  administration perspective
• trust and legitimacy
• protecting citizens’ rights

Four domains to measuring public value

The researchers synthesised these themes to four domains.

1. Outcome achievement

• The extent to which a public body is improving publicly valued outcomes across a wide variety of areas.
• This can include social, economic, environmental and cultural outcomes.

2. Trust and legitimacy

• The extent to which an organisation and its activities are trusted and perceived to be legitimate by the public and by key stakeholders.

3. Service delivery quality

• The extent to which services are delivered in a high‐quality manner that is considerate of users’ needs.
• These will be maximised when service users are satisfied, and when they perceive the services to be accessible convenient and responsive to their needs.

4. Efficiency

• The extent to which an organisation is achieving maximal benefits with minimal resources.
• It is expected to be high when the benefits provided by an organisation are perceived to outweigh the costs, when unnecessary bureaucracy is avoided and when an organisation is perceived to offer value for money.

Although all reviewed studies identified dimensions of public value, very few made recommendations about how to turn these qualitative dimensions into quantitative scores. Several studies noted difficulties associated with developing quantitative measures.

The bottom line

This is the first known systematic review of research on the measurement of public value. It suggests it may be possible to develop universal measures of public value that could be used across a variety of policy and national contexts.

However for public managers, the question remains about how to operationalise the measurement framework and practically apply it. The researchers themselves acknowledge this when they suggest several areas where further research is needed. This includes the need for more quantitative research to develop and validate measures of public value.

Read more:

Avoiding Theoretical Stagnation: A Systematic Review and Framework for Measuring Public Value  – Nicholas Faulkner and Stefan Kaufman, Australian Journal of Public Administration, Volume 77, Issue 1

Public admin explainer: What is public value? – The Australia and New Zealand School of Government (2017) 

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