Institutional Determinants of Co-Production: Norway as an Illustrative Case

Laws and Regulations

In a multilevel governance system, central policies and regulations define and shape the “role” of local authorities—their degree of discretionary power, their resources, the scope of their obligations to provide a service, and in some cases, which policy instruments they might use. The concentration of authority is expected to vary according to whether the activity constitutes a core municipal service or whether it has a more complementary nature (Brandsen & Honingh, 2016), which means that municipalities need to impose their authority when the law mandates municipal responsibility, while activities of a less regulated nature can be approached with less municipal authority. Consequently, we contend that when a municipality has local discretion, authority can be shared with the community, while in policy fields in which a municipality has less room for maneuver, it is also less able to share authority.

Formalization of Interaction Patterns

The institutionalization of local networks in the form of formal platforms for interaction and information-sharing can improve the flow of information, adhesion to participatory approaches, and delimitation from other policy fields (Cabria & Magnier, 2022). In particular, the access to and flow of information is a crucial function of formal networks and can be the driver for deepened interactions and the development of shared values (Cristofoli et al., 2017). We therefore expect that formalized arenas for interaction will create opportunities for co-production and define the roles of the public sector vis-a-vis the various voluntary organizations (Mosley, 2020).

Resource Dependencies

The nature of financial and professional relationships depends on the distribution of critical resources. If voluntary organizations control a critical resource (from the viewpoint of a municipality), such as volunteers, knowledge, skills, or community trust, the municipality is likely to be inclined to collaborate. Conversely, if voluntary organizations are not in control of a critical resource and are dependent on public funding, there will likely be a low level of co-production. The distribution of resources and the level of competition over resources, therefore, constitute an important component of the policy field (Galaskiewicz & Bielefeld, 1998), which relates to how organizations may compete for users, funds, or other resources. Resource dependence theory (Pfeifer & Salancik, 1978) has, to a large degree, dominated the understanding of how voluntary organizations and non-profits depend on public funds and are thus subject to public steering. For co-production, in a given field, the resources that voluntary organizations control and that the public sector depends upon are just as instrumental for the nature of co-production (Marwell & Brown, 2020).

The framework developed by Stone and Sandfort (2009) describes the functioning of policy fields in public service provision. Here, we examine both policy implementation and policy design. To understand the dynamic between these policy phases, we rely on different institutional feedback mechanisms that may influence the role of voluntary organizations within and between the policy design and policy implementation phases. One such mechanism that influences the role of voluntary organizations is “policy feedback” (Pierson, 1993). In the design phase, “New policies affect the social identities, goals, and capabilities of groups that subsequently struggle or ally in politics” (Skocpol, 1992, p. 58). Policies thus contribute to shaping individuals’ interests and identities and provide economic incentives to advocate during and contribute to the design phase, so when municipalities have a high degree of discretionary power, the policy feedback mechanism makes it likely that voluntary organizations will organize and collaborate to influence them. When the degree of discretionary power is low, such organizations would be better off participating in a coalition at the national level that seeks to influence the national policy framework.

Local policy feedback thus depends on national laws, regulations, and programs. A government often employs a number of tools to shape both policies and the behavior of actors in a given policy field (Salamon, 2002), and a core steering tool is the regulatory environment that structures the forms of action that are available to all actors in a given field (Marwell & Brown, 2020). National regulations shape the scope of opportunities within which actors—both municipalities and volunteer organizations—can maneuver.

In addition, a civil society feedback mechanism may influence the degree of co-production, and the effectiveness of that mechanism depends on the distribution of critical resources. When a voluntary organization controls a critical resource, a municipality may want to engage in co-production in the implementation phase. This can, in turn, provide incentives for civil society to engage in the policy formulation phase. The two mechanisms thus interact and can strengthen the interest of each party in co-producing with the other.

Policy Implementation

Policy implementation is fundamental to local voluntary organizations. A universal finding is that, in all policy fields, voluntary organizations want to co-produce with municipalities. The variation is in how closely the municipalities meet this desire.

A significant number of the cultural activities that take place in communities are co-produced by voluntary organizations and municipal institutions. In all municipalities that we examined, cultural and leisure activities involve a form of co-production between themselves and voluntary organizations. The municipality makes the infrastructure (premises, facilities) available and contributes financial resources either to the organization’s operations or for specific events or projects. This volunteer from a marching band offers an example of the tight relationship:

The marching band was involved in establishing the cultural school [a municipal after-school service teaching music and arts to children]. Because [of the marching band], the municipality could sell lessons right away. The conductor of the marching bands became the principal of the cultural school. The marching band was a very important contributor to the creation of the cultural school and is probably the biggest customer too.

The municipality was obliged by law to establish a cultural school and had freedom in how it achieved this. But it could not do so without collaboration with the voluntary organizations that possessed the necessary resources, in the form of skills and access to potential users. At the same time, the marching band needed the services of the cultural school, and the existence of formalized networks smoothed this interaction.

In the field of immigrant integration, co-production in the delivery of services and activities is widespread, but not in the nationally mandated training classes in the Norwegian language and society. Co-production takes place within activities that are not tightly regulated by law. There is a mutual dependence, but the interaction is still somewhat informal. For example, most municipalities have examples of a scheme with “refugee guides” in which a volunteer introduces a refugee to the local community and the services available. All municipalities want this offered in their communities, but two municipalities that tried to establish it alone discovered that they needed a voluntary organization as a partner because the municipalities lacked the legitimacy to ask for such volunteer work from their residents. Indeed, immigrant integration involves establishing a bond among residents, which is something that voluntary organizations are better suited to facilitate than the public sector, leaving the municipality dependent on voluntary organizations to engage residents. Similarly, all municipalities consider areas of volunteering other than those explicitly working with integration—especially sports and culture—to nevertheless be an important part of integration work. Thus, the municipality becomes dependent on voluntary organizations.

We therefore see a field in which the municipality often depends on the resources of the voluntary sector. In principle, the municipality is the stronger party by virtue of its financial, skills, and information resources, but there are still a lot of volunteers, regardless of the municipality, and we see more cases in which the municipality is the party that wants to connect with autonomous volunteering.

The influx of refugees in 2015 and the consequent increase in interactions between the voluntary sector and municipalities is a common theme and was seen as a positive experience by both parties. This is generally viewed as a period of more co-production, when voluntary organizations were invited into the core of public responsibilities. There has been some disappointment, especially from the voluntary sector, that immigrant integration has since become a lower priority for municipalities, and the lack of formalization of the relationship may have contributed to a decline co-production after 2015. When there was no pressing need for action, there was no institutional mechanism to secure interaction.

In health and care, we find moderate levels of co-production in policy implementation. A challenge that interviewees from both the voluntary organizations and the municipalities mention is that a municipality’s activities in this area requires a high degree of professionalism and are regulated by national legislation and guidelines. We see some divergence among municipalities in terms of organizing their health and care services, but this is not reflected in any variation in the willingness to co-produce core services with the voluntary sector.

One way to overcome this challenge is a division of tasks in which municipalities provide care services while volunteers are involved in covering the service users’ social needs—something that has also been found in other studies of volunteers in Norwegian municipal health care (Skinner et al., 2019). The municipal services directed at social needs are not tightly regulated, and it is in providing those needs that we observe moderate levels of co-production. The users of such municipal services are of fragile health, and municipal staff need to provide them with clothing, food, and medicine to ensure they are ready to engage with the social needs volunteers at scheduled times. However, the municipality prioritizes the operation of its own care services, and volunteering merely contributes to the extent that it does not interfere with the priorities of the municipal services, reflecting that this is an area with clear hierarchies of power.

Interestingly, the interviewees from the municipalities report finding that there is no room, at least within their own resources, to address many of the social needs that volunteers cover and that volunteers thus can play a crucial role in the overall services. Furthermore, the representatives from the municipalities see volunteer contributions as a means of achieving the public goal of more elderly people living longer at home. However, this does not lead to a sense of interdependence or an increased use of co-production. In this field, the division between nationally mandated and non-mandated services is fundamental such that voluntary organizations’ resources are not critical because they are only important to non-mandated services.

Representatives from voluntary organizations share this view but believe the municipalities could benefit from recognizing the resources of the organizations and thus engage in more co-production. One representative of a voluntary organization describes an annoyance that was also mentioned to us in other places:

There are now nine of us on the board. Four or five of us have a health professional background and are more than sufficiently educated to be able to teach both in dementia-friendly communities and with activity friends [. . .] I think we could have done that, and then they could have stopped saying that they have little money, because they spend money on something that is, strictly speaking, not necessary because they have educated people to take the job [on a volunteer basis].

A lack of formalized arenas for interaction may explain some problems in communication that seem to be an obstacle to attempts to co-produce. We find that a pervasive theme is a relationship between volunteering and public responsibility, and we have examples of voluntary organizations noting that cooperating with a municipality can be demanding because the municipal staff are afraid that volunteers will take their jobs. Boundaries between public responsibilities and the territory of the voluntary organizations are important for both parties, and shared understanding here is paramount for successful co-production. Without formal arenas for interaction it is more difficult to develop necessary shared understandings.

In services for children and adolescents, there is generally a low level of co-production related to a municipality’s core tasks. School and day care are the main municipal services but are not a center for co-production. A municipal manager for educational services explains the limitations in the field: “In my field, there is not much [co-production]. When it comes to schools, kindergartens. . . Special education services are fairly regulated.”

Efforts from voluntary organizations are more prominent within services aimed at children from disadvantaged families and often involve voluntary organizations providing leisure-time activities for children and using municipal professional services to contact economically disadvantaged families. We uncover such co-production in several places; in one municipality, public employees are very enthusiastic about the results of a process initiated by a voluntary organization that established a “library for sports and outdoor equipment”:

We entered into a dialog with them [the Red Cross], and we went to Oslo and looked at different types of schemes. Then I wrote a proposal to the city council [. . .]. So we entered into an agreement with the Red Cross where we go in with operating assets, and they take care of the whole package. This is one fantastic example of how the municipality can use the voluntary sector and how the voluntary sector simply grows.

This is a typical example of co-production in services aimed at children and adolescents. It does not involve core municipal services, but municipalities provide funding and infrastructure. The law does not regulate the content of such services, but there is an expectation that municipalities will provide help to children from disadvantaged families. Generally, the lack of voluntary organizations solely committed to this group makes such formalization difficult—those organizations that do exist are mainly viewed as part of the culture and leisure field, in which formalization is stronger.

Overall, as we can see from Table 3, in policy implementation it is only within culture and leisure—and to a lesser extent immigrant integration—that we find high levels of co-production. Along the three analytic dimensions, we find that, for laws and regulations, co-production takes place within the aspects of each field in which regulations are most lenient; therefore, there is most space within culture and leisure because this is the policy area with the least regulation.

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Table 3.

Overview of the Levels of Co-Production and Analytic Dimensions in Policy Implementation in the Four Policy Fields.

Policy field	Laws and regulations	Formalization	Resource dependency	Co-production
Culture and leisure	Much local discretion	High	Mutual dependence	High
Integration of immigrants	Some local discretion	Limited	Little dependence both ways, except following the influx of asylum seekers in 2015	Moderate; high in 2015
Health and care	Little local discretion	Some	Voluntary organizations highly dependent on municipalities Municipalities have little dependence on voluntary organizations	Moderate
Children and adolescents	Some local discretion	Limited	Little dependence both ways	Low

Formalization of interaction patterns is found in culture and leisure and to a lesser extent, in health and care services, but only in culture and leisure do the municipalities depend upon the resources of voluntary organizations. There also seems to be a hierarchy among the dimensions in predicting the level of co-production: laws and regulations are a strong predictor of co-production, formalization is less prominent in all service areas, but resource dependence is particularly important when it co-varies with laws and regulations. For example, in health and care, municipalities need volunteers to cover social needs that are not regulated by law, but this nevertheless does not lead to a municipal willingness to engage in co-production. Unlike what we will see regarding policy formulation, formalization does not follow from resource interdependence.

For documentation of the municipality-by-municipality variations, please refer to the Appendix.

Policy Design

In culture and leisure, voluntary organizations are at the heart of policy design. The interviewees from both the municipalities and the voluntary organizations describe how policies have been developed through a co-productive process and how arenas exist that constitute platforms for co-producing policy.

This is the field with the most voluntary organizations and the one in which municipalities spend the most resources on interacting with volunteers, and in every municipality, we find one or more arenas for communication and formal decision-making. Because of the wide range of organizations and the many resources invested by municipalities, formal arenas are needed for somewhat-transparent decision-making processes and to ease communication and relationships between the municipality and the dozens or even hundreds of organizations with a stake in the decisions being made. The result is a formal system dominated by the largest organizations. One representative from a municipality describes a typical scenario:

Those who are heard are the biggest; it’s the majority, and in a way, it’s right, but then you get the scheme that we have today, where you spend a lot of money in sports and sports arenas [and less on other forms of culture].

No other policy area has formalized the relationship between voluntary organizations and municipalities to the same extent, and this is consistent across all the municipalities.

An underlying theme in the interviews is that culture and leisure is a policy field with mutual resource dependence. Municipalities have resources upon which organizations depend, in the form of funds and access to public buildings and infrastructure, but they have limited activities of their own; for there to be services for residents, organizations are key, and their policy priorities must be acknowledged. In summary, this is a field with limited national regulation, in which the municipality needs the organizations and in which formal arenas for interaction have been established. Taken together, this creates high levels of co-production.

In the field of immigrant integration, we find little evidence of co-production in most of the municipalities, although there is one notable exception of a municipality that has gone further than most in promoting co-production in service development across the board. This is also corroborated by other studies that have found limited examples of co-production in policy design in this field in Norway (Espegren et al., 2019).

Integration is a field with some nationally determined policies, but most municipalities have initiatives that go beyond national demands, thus offering room for local stakeholders to co-produce policy design, although there is currently limited organizational willingness to do so. On this dimension, one might thus have expected there to be room for co-production.

Organizations working on integration are a mix of large established organizations, like the Red Cross, and newer organizations without established connections to the public sector and without the ambition for involvement in policy design. In municipalities in which large established organizations are present, those organizations will typically have access and opportunities to influence municipal processes, but in our data, we find little willingness to use this access. Thus, there has been no need to establish formal arenas for engagement between voluntary organizations and municipalities because there is no interest from the organizations to do so.

An interesting exception to this picture is in the municipalities’ uniform experience of the major arrival of refugees in 2015, which prompted them to reach out to organizations for help in integrating the refugees and that, with increased co-production in the implementation of policies, opened a space for voluntary organizations in policy formulation as well. In that situation, there was also more willingness from the organizations to engage in policy formulation, suggesting feedback processes between the phases. One interpretation of this finding is that the local room for maneuver is insufficient for co-production and that the division of resources and resulting dependencies between organizations and municipalities is important for the propensity to co-produce policy formulation. When the integration task at hand became bigger, the interdependence grew and thus also the co-production.

In health and care services, care for the elderly is at the heart of both municipal services and the efforts of voluntary organizations. On the municipality side, the dominant view is that national laws and regulations and professional standards offer little room for maneuver and thus limit the ability of voluntary organizations to take part in co-production of policy design. At the same time, there is variation among municipalities in how they develop their services, reflecting some room for local discretion. This implies that, although national regulation is central in our data, it might be understood as a local cultural feature more than an actual formal limitation on practices. One possible explanation for the widespread nature of this municipal approach to voluntary organization may be institutional isomorphism across municipalities in their understanding of care responsibilities and the room available to involve non-public actors.

At the same time, voluntary organizations have made few attempts to take an active part in policy design beyond financial support for themselves. Voluntary organizations often explicitly seek to stay out of municipal policy discussions, as this leader of a voluntary organization explains:

[The organization] cannot participate in politics and say which direction things should go, but we are allowed to come in and talk about our project, and we can apply for money from the municipality.

Despite these organizations often having activities directly related to municipal services, such as being “visiting friends” at nursing homes, they have no interest in influencing those services. This is a somewhat surprising finding because the other branch of civil society—the non-profit sector—has traditionally played an important role in providing ideological and professional direction to the development of welfare (Selle et al., 2018). Since there is a limited willingness for co-production, there is again no need to establish formal arenas for interaction. For health and care, we thus see little local room for maneuver, little formalization of relationships—and thus little co-dependence on each other’s resources—and an accordingly low level of co-production.

In the children and adolescents policy field, schools are the most important public service and are strictly regulated nationally. There are also few voluntary organizations in this field, once one excludes those dedicated to culture and leisure. One exception is in a district in an economically disadvantaged part of Oslo, where considerable public efforts are being made toward community development, and building and interacting with civil society organizations are a key part of these efforts. As one representative from a voluntary organization explains,

We have been invited to several councils. [. . .] There are many who say, “Hi, [various public agencies and volunteer umbrella organizations] want you to join a committee.” We are here to build our local community.

This exemplifies how the public sector engages in extensive community work in areas with a large proportion of residents who are immigrants. In this particular area, the public sector needs a voluntary organization to engage with and understand the local population, and it is thus an example of a municipality needing civil society resources. In this situation, the policy fields of youth and children, immigrant integration, and culture and leisure overlap, but the situation is limited to the specific context of a big city with a diverse and disadvantaged population. Other municipalities have a more traditional division of labor, with the municipality dominating the design of school and day care services while voluntary organizations dominate culture and leisure activities for adolescents. This demonstrates the importance of real resource interdependence in understanding the level of co-production.

In summary, we see from Table 4 that, of the three analytic dimensions, culture and leisure is the only field in which laws and regulations give local discretion, with identifiable formalized patterns of interaction and mutual dependence. Beyond culture and leisure, there is limited co-production in policy design, with low scores on all three dimensions. This tendency is also found in broader studies that have found that, among Norwegian voluntary organizations, local-level advocacy is in decline while national-level advocacy is growing (Sivesind et al., 2018).

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Table 4.

Overview of the Levels of Co-Production and Analytic Dimensions in Policy Formulation in the Four Policy Fields.

Policy field	Laws and regulations	Formalization	Resource dependency	Co-production
Culture and leisure	Much local discretion	High	Mutual dependence	High
Integration of immigrants	Some local discretion	Limited	Little dependence both ways, except following the arrival of asylum seekers in 2015	Low, but higher during the arrival of asylum seekers in 2015
Health and care	Little local discretion	Limited	Voluntary organizations highly dependent on municipalities	Low
Children and adolescents	Little local discretion	Limited	Voluntary organizations dependent on municipalities, except in disadvantaged districts in Oslo, where there is mutual dependence	Low, except in disadvantaged districts in Oslo

Interestingly, the exceptions to the general pattern underline the potentially crucial role of resource dependence and suggest how the three dimensions—and policy fields—are related. Notably, in the district of Oslo with a diverse population and socio-economic challenges, the municipality depends on the organizations for engagement with the minority population, which leads in turn to some level of formalized relationships and co-productive activities that expand to the parts of services for integration and for children and adolescents that are not tightly regulated by the national government. In this case, specific local circumstances lead to increased scores on all three analytic dimensions and a higher level of co-production. A similar pattern was seen across all municipalities in 2015, when a large number of immigrants arrived, which changed the dynamics in the field, producing higher scores on all dimensions and more co-production. This also underlines that the institutional structure is not entirely static but can be altered through external or internal shocks.

For documentation of the municipality-by-municipality variations, please refer to the Appendix.