Exit, Voice, and Loyalty in Urban Politics Peter John (University of Manchester)

Policy background Choice a key objective of government policy - assumed to deliver benefits to the consumer Choice and voice assumed to be complementary – see Social Market Foundation, Choice: The Evidence (2004) No tests of this statement

Hirschmann Exit, Voice and Loyalty (1970) Studied nationalised industries in Africa – found that competition led to loss of efficiency – a puzzle Argued that consumers who are locked in agitate to keep services efficient. No incentive to voice under competition when other opportunities available

Hirschmann (continued) Posited a negative trade-off between exit and voice Mediated by loyalty – a less clear part of the Hirschman model Can apply to a variety of settings: schools, employment quits (unions), consumers (see Dowding et al review article: EJPR, 2000)

Modifications Voice is too simple – there are different types of voice, collective (eg voting, group membership) and individual (e.g. complaining) Collective voice is harder to organise because of CA (PD problems) So hypothesis is that individual voice does not trade-off with exit, collective voice does – exit and two voice

Modifications continued Exit takes different forms to: Moving providers within jurisdiction Moving jurisdiction Exit to private services So three exit, two voice model Also voice can be divided into voting and more active categories, so three voice, three exit!

Thinking about loyalty Loyalty not well defined in Hirchmann Better to see it as social investment which increases voice and reduces exit Can be conceptualised as social capital Neighbourhood attachment Trust Group membership

Satisfaction Need to think about as a separate variable Also can mediate exit-voice tradeoff Something that providers can affect at the aggregate level

Hypotheses H1: Intentions to exit will decrease collective voice activity. H2: Intentions to exit will decrease individual voice, but less than collective voice H3 – Social investment increases collective and individual voice H4: Lack of exit availability will increase collective voice more than individual voice H5: Dissatisfaction will increase voice first, then exit H6: Satisfaction will increase after exit H7: Satisfaction will increase after voice has been successfully responded to

The study Internet Survey – YouGov Sampled 9500 which yielded 4067 responses, a response rate of 42.1 per cent. In wave 2 we got a response of 2,619, 64.5 per cent of wave two. In wave three we surveyed those who responded in wave two and supplemented the panel to yield 4952 responses which includes 1744 of those from wave 2. In wave four we surveyed all the previous waves producing 3468 responses (1690 from waves 1; 1486 from wave 2; and 2941 from wave 3). There were 1138 respondents who answered all waves. On-line questionnaire

Dynamic aspects of the study What does an event in one period do in the next period? Key event is exit to the private sector - does exit increases satisfaction First we look at change in satisfaction from wave 1 to 2, which is a difference in confidence that an injury will be treated The see if there is correlation with exit in wave , which there is: -.05 (p=.08)

Impact of satisfaction on exit over four years of the panel Time expecting treat 0.0984***(-0.022) Household income 3.34e-05*** -1.66E-06 Year -0.104*** -0.0199 Sex -0.155** -0.0631 Constant -2.630*** -0.146 Observations 11799 Number of id 5929

Conclusions Many expected relationships between satisfaction and voice, and between satisfaction and exit There is a link between lock in and voice Trade-off between exit and voice for intentions to move, but less for other forms of exit Policy implications – costs of exit needs to be factored in to policy choices