David Switzer is a PhD candidate at Texas A&M University. His work examines how context moderates the effect of organizational structures on performance. He is specifically interested in how factors external to organizations, such as citizen participation and human capital, differentially impact the decision making and performance of private and public organizations. His empirical focus is on environmental policy, investigating how privatization, context, and citizen engagement affect the implementation of environmental policy. Manuel P. Teodoro is associate professor at Texas A&M University. His public administration research emphasizes executive behavior, with attention to professions and career systems as political phenomena. His policy research focuses on environmental policy and the ways in which human capital, management, and political institutions condition the implementation of environmental regulations. He also pursues a line of applied research on utility finance and management and has developed advanced methods for assessing rate equity and affordability.Abstract : This article advances a resource endowment theory of human capital and performance in government organizations. Building on research on human capital and firm location in business economics and task complexity in public management, the authors argue that an agency ' s ability to implement policy is determined both by its scale and by the human capital of the population from which it draws its employees. The authors cast labor as a factor of production in public agencies and argue that access to higher-quality labor improves government effectiveness. The effect of human capital on performance is especially pronounced when agencies are charged with the implementation of technically complex tasks. The empirical subject is U.S. municipal water utilities' compliance with the Safe Drinking Water Act. Comparing records of compliance with more and less complex regulatory requirements provides evidence consistent with the general model. The findings carry important implications for public management and policy design.
Practitioner Points• A public agency ' s performance is partly a function of the availability of human capital-that is, educated workers-in the labor market from which it draws workers. • Larger organizations can leverage available human capital more effectively than smaller organizations. • The effect of human capital resource availability on performance depends on the complexity of an agency ' s task: as task complexity increases, so does the importance of human capital for agency performance. • Agencies that operate in isolated or low human capital labor markets face exceptional challenges in executing complex tasks. • Managers of smaller agencies seeking to improve performance should look for opportunities to scale up human capital development through collaboration and/or consolidation.