Modelling the spatial impact of the introduction of Compulsory Competitive Tendering

This paper uses data on local authority garbage collection costs to measure the spatial impact of the shift from local in-house monopoly provision to Compulsory Competitive Tendering (CCT). The data shows that before CCT service costs were correlated across authorities after controlling for their characteristics. However, following CCT this spatial correlation disappears or is significantly attenuated. We associate this change with the way in which contracts were written before and after CCT. We also show that political factors were an important factor in determining costs both before and after CCT. (C) 2000 Elsevier Science B.V. All rights reserved.