The effects of fiscal contraction on innovation in the public sector
A review of the literature suggests that fiscal contraction will cause the innovative process in the public sector to fall on hard times. Most of the environmental and organizational factors deemed conducive to innovation will be less present under fiscal constraints than they had been during periods of expansion. The only major force in favor of innovation will be a growing gap between the actual performance levels of public agencies and the levels that both agency administrators and members of the public would like to see. A climate of 'something must be done' generally leads to some kind of innovation, whether good or bad. Hence, the innovations that will thrive are likely to be those that help manage the contraction process rationally. The influences threatening other types of innovations are not only formidable but self-reinforcing.
"A review of the literature suggests that fiscal contraction will cause the innovative process in the public sector to fall on hard times. Most of the environmental and organizational factors deemed conducive to innovation will be less present under fiscal constraints than they had been during periods of expansion. The only major force in favor of innovation will be a growing gap between the actual performance levels of public agencies and the levels that both agency administrators and members of the public would like to see. A climate of 'something must be done' generally leads to some kind of innovation, whether good or bad. Hence, the innovations that will thrive are likely to be those that help manage the contraction process rationally. The influences threatening other types of innovations are not only formidable but self-reinforcing."@en
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