Hostname: page-component-586b7cd67f-2plfb Total loading time: 0 Render date: 2024-11-28T23:11:23.993Z Has data issue: false hasContentIssue false
  • English
  • Français

New Public Management as a Response to the Crisis of the 1970s: The Case of Finland, 1970–1990

Published online by Cambridge University Press:  06 July 2015

VILLE YLIASKA
VILLE YLIASKA*
Affiliation:
Unioninkatu 38 A, PL 59, 0001University of Helsinki, Finland; [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

The article gives an overview of Finland's responses to the economic crisis of the 1970s. In particular, it focuses on public sector reforms that fall under the label New Public Management (NPM). These reforms are interpreted in the context of an overproduction crisis. The article contends that in the 1980s and 1990s power in Finland was centralised through the doctrines of NPM in order to reallocate public resources from welfare services to industrial policy and thus confront post-industrialism. In doing so, it provides a new explanation as to why NPM reforms were carried out. The main justification of NPM-reforms – ‘decentralisation’ – is analysed from different angles. In the late 1960s decentralisation referred to the autonomy of the municipalities. In the 1980s it referred to ‘efficient leadership’, which meant in practice more power over resources for the state. The idea was to reallocate public resources from welfare services to research and development and venture capital. In effect, NPM was part of a new kind of state interventionism not part of a neoliberal project to destroy or hollow out the state.

Type
Articles
Information
Contemporary European History , Volume 24 , Issue 3 , August 2015 , pp. 435 - 459
Copyright
Copyright © Cambridge University Press 2015 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 Hood, Christopher, ‘A Public Management for All Seasons’, Public Administration, 69, 1 (1991), 3–19.CrossRefGoogle Scholar

2 Pollitt, Christopher, Managerialism and Public Services. Cuts or Cultural Change in the 1990s (Oxford: Blackwell, 1993), 1–27Google Scholar.

3 Haynes, Philip, Managing Complexity in the Public Services (Maidenhead: Open University Press, 2003), 5–10Google Scholar.

4 Pollitt, Christopher and Bouckaert, Geert, Public Management Reform. A Comparative Analysis (Oxford: Oxford University Press, 2000), 6–8Google Scholar.

5 Saint-Martin, Denis, Building the New Managerialist State. Consultants and the Public Sector Reform in Comparative Perspective (Oxford: Oxford University Press, 2000), 14–5Google Scholar. See also Osbourne, David and Gaebler, Ted, Reinventing Government. How the Entrepreneurial Spirit Is Transforming the Public Sector (Reading: Plume Book, 1993), 15Google Scholar.

6 Saint-Martin, Building, 25. Path dependency offers an explanation for situations in which a chain of events, evolution or end results of a conflict are impossible to understand without historical context. Preceding nodes or crossroads define the number of choices available in the next phase. ‘Path dependency is a way to narrow conceptually the choice set and link decision making through time’. North, Douglas C., Institutions, Institutional Change and Economic Performance (Cambridge: Cambridge University Press, 1990), 98CrossRefGoogle Scholar.

7 Kiander, Jaakko and Lönnqvist, Henrik, Hyvinvointivaltio ja talouskasvu (Helsinki: WSOY, 2002), 14–8Google Scholar.

8 The Welfare State in Crisis: an Account of the Conference on Social Policies in the 1980s, OECD, Paris, 20–23 October 1981 (Paris: OECD, 1981), 30–1, 41–50; on the conference in Korpilampi see Saari, Juho, ‘Suomalainen konsensus – Korpilammen konferenssi (1977) käännekohtana’, Yhteiskuntapolitiikka, 75, 5 (2010), 469–87Google Scholar and Klinge, Matti, ‘Konsensus’, in Meinander, Henrik, Tasavallan tiellä (Helsinki: Schildts, 1999), 451–2Google Scholar.

9 See for example Lähdesmäki, Kirsi, New Public Management ja julkisen sektorin uudistaminen: tutkimus tehokkuusperiaatteista, julkisesta yrittäjyydestä ja tulosvastuusta sekä niiden määrittelemistä valtion keskushallinnon reformeista Suomessa 1980-luvun lopulta 2000-luvun alkuun (Vaasa: Universitas Wasaensis, 2003), 150Google Scholar, 198–202; Temmes, Markku, ‘Suomen hallintopolitiikan pitkät aallot ja käännekohdat’, Hallinnon tutkimus, 3 (2008), 69–79Google Scholar.

10 On recent interpretations of neoliberalisation, see Willem Zuidhof, Petrus, Imagining Markets. The Discursive Politics of Neoliberalism (Rotterdam: Erasmus Universiteit Rotterdam, 2012), 139–50Google Scholar; Van Horn, Rob and Mirowski, Phillip, ‘The Rise of the Chicago School of Economics and the Birth of Neoliberalism’, in Mirowski, Philip and Phlewe, Dieter, eds., The Road from Mont Pélerin. The Making of the Neoliberal Thought Collective (Cambridge, Mass: Harvard University Press, 2009), 159–62Google Scholar; Roberts, Alasdair, The Logic of Discipline: global capitalism and the architecture of government (Oxford: Oxford University Press, 2010), 23–96CrossRefGoogle Scholar, 140–6. See also Phillip Mirowski, ‘Postface: Defining Neoliberalism’, in Mirowski and Plehwe, The road from Mont Pélerin, 434–5; Peck, Jamie, Constructions of Neoliberal Reason (Oxford: Oxford University Press, 2010), 9–10CrossRefGoogle Scholar.

11 Christopher Pollitt and Dan Sorin: The Impacts of the New Public Management in Europe: A Meta-analysis, COCOP work package 1 – deliverable 1.1 2011, 30–6. http://www.cocops.eu/wp-content/uploads/2012/03/WP1_Deliverable1_Meta-analysis_Final.pdf (last visited 5 June 2014).

12 I will make a detailed analysis of the meaning of the word in its historical context. Reinhart Koselleck's idea is that we can understand the intentions of the actors better if we analyse their concepts thoroughly. Koselleck, Reinhart, ‘Begriffgeschichte and Social History’, Economy and Society, 11, 4 (1982), 409–15CrossRefGoogle Scholar; idem, ‘Social History and Conceptual History’, Politics, Culture and Society, 2, 3 (1989), 312.

13 According to Huizinga, a historian must treat a research subject and events as situations in which several different choices are still open with several possible outcomes. See Huizinga, Johan, Historian olemus. Esseitä ja tutkielmia (Porvoo: WSOY, 1967), 49Google Scholar. On crossroads see Bergholm, Tapio and Saari, Juho, ‘Tapahtumaketju ja solmukohdat: Heikki Waris ja ammattiyhdistysliikkeen eheyttäminen 1946–1966’, Yhteiskuntapolitiikka, 75, 3 (2010), 3–18Google Scholar.

14 In Finland ‘the state’ usually refers to the central government. In this article I will use the two terms as synonyms.

15 At the time stagflation was supposed to be impossible. The Phillips curve stated that the lower the unemployment, the higher the rate of inflation, Desai, Megnah, Marxin kosto. Kapitalismin uusi nousu ja valtiokeskeisen sosialismin kuolema (Tampere: Vastapaino, 2008), 95Google Scholar, 275–7.

16 See, for example, Bell, David, The Coming of the Post-Industrial Society – A Venture in Social Forecasting (New York: Basic Books, 1976)Google Scholar; Webster, Frank, Theories of Information Society (London: Routledge, 1995), 30–2Google Scholar, 169; Gorz, Andre, Reclaiming Work. Beyond the Wage-Based Society (Cambridge: Polity Press, 1999), 12Google Scholar.

17 Lucas, Robert and Sargent, Thomas J., ‘After the Keynesian Macroeconomics’, in After the Phillips Curve. Persistence of High Inflation and High Unemployment (Boston: Federal Reserve Bank of Boston, 1978), 56–7Google Scholar; Lucas, Robert, ‘The Death of Keynesian Economics’, Issues and Ideas, Winter (1980), 18–19Google Scholar; see also Mankiw, Gregory, ‘The Macroeconomist as Scientist and Engineer’, Journal of Economic Perspectives, 20, 4 (2006), 33–4CrossRefGoogle Scholar.

18 Glyn, Andrew, Capitalism Unleashed. Finance, Globalization, and Welfare (Oxford: Oxford University Press, 2006), 15–27Google Scholar.

19 For the critique of the welfare state in the 1940s and 1950s see, for example, Lowe, Rodney, The Welfare State in Britain since 1945 (London: Palgrave, 2005), 13CrossRefGoogle Scholar; Smolander, Jyrki, Suomalainen oikeisto ja ”kansankoti” (Helsinki: Gummerus, 2000), 67Google Scholar, 86.

20 Christopher Pierson, Beyond the Welfare State. The New Political Economy of Welfare (Cambridge: Polity Press, 1998), 148.

21 On the attack on the Welfare State and Keynesianism see Landreth, Harry and Colander, David C., History of Economic Thought (Boston: Houghton Mifflin, 1994), 480–1Google Scholar; Mark Blyth, Great Transformations. Economic Ideas and Institutional Change in the Twentieth Century (Cambridge: Cambridge University Press, 2002), 148; Bonoli, Giuliano, George, Vic and Taylor-Gooby, Peter, European Welfare Futures. Towards a Theory of Retrenchment (Cambridge: Polity Press, 2000), 96–118Google Scholar; John Williamson, ‘What Washington means by policy reform’ (1989), http://www.iie.com/publications/papers/paper.cfm?researchid=486 (last visited 20 May 2013). Regarding confrontation and consensus see Geppert, Dominik, ‘Der Thatcher-Konsens. Der Einsturz der britischen Nachkriegsordnung in den 1970er und 1980er Jahren’, Journal of Modern European History, 9, 2 (2011), 184–5CrossRefGoogle Scholar.

22 Bonoli, George and Taylor-Gooby, European Welfare, 59–62.

23 Desai, Marxin kosto, 326–8.

24 Magnusson, Lars, ‘Do the Nordic Lights Shine Bright Again? – Sweden's Response to the 1970s and 1980s Crisis’, Journal of Modern European History, 9, 2 (2011), 212Google Scholar.

25 On the economic crisis and its links to the size of the public sector see ‘Hallituksen tavoitteet ja toimenpiteet talouden tasapainottamiseksi ja työllisyyden turvaamiseksi’ 1976, Uab 12, Department of Budget, The Archive of the Ministry of Finance, The National Archives of Finland, Helsinki; ‘Toimitusjohtaja Max Jakobsonin vastaukset Etelä-Suomen Sanomien kysymyksiin’ 1975, 32, The Archive of the Finnish Business and Policy Forum, The National Archive of Finland, Helsinki; Holkeri, Harri, Itsenäisiä ajatuksia (Helsinki: Kirjayhtymä, 1977), 71–8Google Scholar.

26 Uljas, Päivi, Hyvinvointivaltion läpimurto (Helsinki: Into, 2012), 247–62Google Scholar.

27 Pekkarinen, Jukka and Vartiainen, Juhana, Suomen talouspolitiikan pitkälinja (Porvoo: WSOY, 1993), 343–4Google Scholar.

28 Kettunen, Pauli, Työjärjestys. Tutkielmia työn ja tiedon poliittisesta historiasta (Helsinki: Tutkijaliitto, 1997), 115–23Google Scholar.

29 Lundin, Per and Stenlås, Niklas, ‘Technology, State Initiative and National Myths in Cold War Sweden: An Introduction’, in Lundin, Per, Stenlås, Niklas and Gribbe, Johan, eds., Science for Welfare and Warfare. Technology and State Initiative in Cold War Sweden (Sagamore Beach: Watson Publishing International, 2010), 6–8Google Scholar.

30 In Finland the governments are multiparty governments.

31 Governments listed on the official site of Finnish government: http://valtioneuvosto.fi/tietoa-valtioneuvostosta/hallitukset/vuodesta-1917/tulokset/fi.jsp?report_id=V2 (last visited 6 September 2013).

32 Suomi, Juhani, Umpeutuva latu. Urho Kekkonen 1976–1981 (Keuruu: Otava, 2000), 33–5Google Scholar.

33 On the history of the Agrarian-Centre Party see Isohookana-Asunmaa, Tytti, Maalaisliitto-keskustan historia 5 (Keuruu: Otava, 2006), 434–532Google Scholar.

34 On the reasons for this see, for example, Hobsbawm, Eric, Äärimmäisyyksien aika (Helsinki: WSOY, 1999), 387Google Scholar; Wirsching, Andreas, ‘European Responses to the Crisis of the 1970s and 1980s: Introductory Remarks’, Journal of Modern European History, 9, 2 (2011), 167–8CrossRefGoogle Scholar.

35 Blyth, Great Transformations, 148–50.

36 Harvey, David, The Condition of Postmodernity (Oxford: Blackwell Books, 1989), 354Google Scholar.

37 With regard to ‘governmentality’ see Dean, Mitchell, Governmentality. Power and Rule in Modern Society (London: Sage, 1999), 16–20Google Scholar.

38 On the ways in which OECD materials are used in Finland to justify different political stances see Alasuutari, Pertti and Rasimus, Ari, ‘Use of the OECD in Justifying Policy Reforms: The Case of Finland’, Journal of Power, 2, 1 (2009), 89–109CrossRefGoogle Scholar.

39 On the methodology of the history of ideas see Hyrkkänen, Markku, Aatehistorian mieli (Tampere: Vastapaino, 2002), 136–57Google Scholar, 209–10.

40 All OECD materials used in this piece are located in the Finnish archives. I have not been able to link the OECD discussions about industrial policy more clearly to the Finnish ones; archival connection and the similarity of the themes discussed are the only connections at this point of my research. What is clear is that OECD material about the content of NPM reforms per se and the OECD material about the reforms in other OECD countries were actively used as role models and justifications in almost all Finnish NPM reforms. This applies to the reforms analysed in this article too: see, for example, Maailman paras julkinen sektori. Julkisen hallinnon kansainvälinen vertailuprojekti (Helsinki: Valtiovarainministeriö, 1993), 7–10, 20, 49–50, 59, 81, 131.

41 Meeting memo, 28 Nov. 1975, Experimental Project on innovation in the procedures and structures of government, Foreign Contacts 1972–1978, Hd 20, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

42 OECD, Paris, 17 Oct. 1977, TECO(77)11, Scale 2, Technical cooperation committee (TECO). Joint activity on public management improvement: policies and institutions, Foreign Contacts 1972–1978, Hd 20, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

43 The size of the public sector equals the proportion of public expenditures in relation to GDP.

44 OECD, 22 Oct. 1976, TECO(76)12, Technical Cooperation Committee (TECO) proposed joint activity in the field of public management, 4, Foreign Contacts 1972–1978, Hd 20, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

45 OECD/TECO, Paris, Mar. 1979, CT/PUMA/500, Cooperative action programme. Joint activity on public management improvement. Seminar for Controlling Public Expenditure, Hd22, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

46 OECD/TECO, Paris, 27 June 1980, C(80)115, Council Programme of Work of the Organisation for 1981: General lines of the Secretary-General's proposals, 10, Hd22, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki; OECD, Paris, 14 Apr. 1980, TECO(80)4, Appendix A(1), Hd22, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

47 OECD/TECO, Paris, 15 Apr. 1980, TECO(80)7, Technical Cooperation Committee. Outline of the Co-operative Action Programme for 1981 (Note by Secretariat), Hd22, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki; OECD, TECO, Paris, 25 Aug. 1980, CT/PUMA(80)1, Co-operation Programme. Steering Committee of the joint activity on Public Management Improvement, 2–3, Hd22, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

48 OECD/TECO, 22. Oct. 1976 TECO (76)12, TNAF, HD20. See also OECD/TECO, Paris, 27 Jun. 1980 C(80)115, TNAF, Hd22.

49 One of the goals behind the new mandate was the wish to strengthen the relationship of the committee's activities with the mainstream of the OECD's work. OECD, Paris, 14 Apr. 1980, TECO(80)4, Technical Cooperation Committee. Report on the Cooperative Action Programme for 1979, 1–2, Hd22, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

50 Pietarinen, I., Sauna-aho, J. and Takanen, I., ATK-politiikka ja tietoliikennepolitiikka. Report from the Computer/Telecommunications Policy-conference February 1975 (Helsinki: Ministry of Finance, 1975), 11–2Google Scholar.

51 Webster, Theories, 11, 30–2.

52 OECD/TECO, Paris, 20 Jun. 1980 TECO(80)9, 2, Technical Co-operation Programme. Joint Activity on Public Management Improvement. Summary Report on the Seminar on Controlling Public Expenditure (note by the Secretariat), Hd22, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

53 OECD, Paris, 15 Apr. 1980, TECO(80)7, TNAF, Hd22.

54 OECD, Paris, 14 Apr. 1980, TECO(80)4, Appendix A(iii), Hd22, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

55 Concerning the history of public research and development and venture capital see Kenneth Arrow, ‘Economic Welfare and the Allocation of Resources for R&D’, idem, in, Essays in the Theory of Risk Bearing (Chicago: Markham, 1971), 144–50Google Scholar; Fabrizio, Kira R. and Mowery, David C., ‘The Federal Role in Financing Major Innovations: Information Technology during Postwar Period’, in Lamoreaux, N. R. and Sokoloff, K. L., eds., Financing Innovation in the United States, 1870 to the Present (Cambridge MA: MIT Press, 2007), 283–300CrossRefGoogle Scholar; Campbell, John L. and Lindberg, Leon N., ‘Property Rights and the Organization of Economic Activity by State’, American Sociological Review, 55, 5 (1990), 643–7CrossRefGoogle Scholar.

56 Zysman, John and Newman, Abraham, ‘The State in the Digital Economy’, in Levy, J. D., ed., The State after Statism. New State Activities in the Age of Liberalization, (Cambridge MA: Harvard University Press, 2006), 280–2Google Scholar; Cowhey, Peter and Richards, John, ‘Building Global Service Markets: Economic Structure and State Capacity’, in Levy, J. D., ed., The State after Statism. New State Activities in the Age of Liberalization (Cambridge MA: Harvard University Press, 2006), 320–1Google Scholar.

57 Temmes, Markku, ‘Ohjaus-ja johtamisajattelun kehityksestä valtionhallinnossa’, in Tulosajattelu etenee valtionhallinnossa (Helsinki: VAPK-kustannus, 1990), 10Google Scholar; Stenvall, Jari, Herrasmiestaidosta asiantuntijatietoon: virkamiehistön asiantuntemuksen kehitys valtion keskushallinnossa (Helsinki: VAPK-kustannus, 1995), 253Google Scholar.

58 platform, Government, Talous-ja työllisyyspolitiikka, http://valtioneuvosto.fi/tietoa-valtioneuvostosta/hallitukset/hallitusohjelmat/vanhat/sorsaII/fi.jsp (last visited 2 March 2015)Google Scholar; see also Hämäläinen, Sirkka, ‘Mauno Koivisto ja Suomen Pankki’, in Immonen, Keijo, ed., Pitkä linja. Mauno Koivisto. Valtiomies ja vaikuttaja (Helsinki: Kirjayhtymä, 1993), 151Google Scholar.

59 Kalevi Sorsa's statement in the Social Democratic Party meeting, 18 Aug. 1979, Minutes of the party council, Cb22, The Archive of the Labour Movement, Helsinki.

60 Östberg, Kjäll, När vinden vände. Olof Palme 1968–1986 (Stockholm: Leopard, 2009), 193–4Google Scholar, 234.

61 Kalevi Sorsa in a television interview, 28 Aug. 1979. The Finnish Business and Policy Forum Archive, 86, The National Archive of Finland, Helsinki.

62 Social Democratic Party meeting, 9 Mar. 1977, 14, The Archive of the Labour Movement, Helsinki.

63 Callon, Michel, ‘The Sociology of an Actor-Network: The Case of the Electric Vehicle’, in Callon, Michel, Law, John and Rip, Arie, eds., Mapping the dynamics of science and technology (London: Macmillan, 1986), 21–5CrossRefGoogle Scholar; see also Hecht, Gabrielle, Radiance of France: nuclear power and national identity after World War II (Cambridge, MA: MIT Press, 1988), 330–1Google Scholar.

64 For the intellectual influences of Finnish youth see Kolbe, Laura, Eliitti, traditio, murros. Helsingin Yliopiston Ylioppilaskunta 1960–1990 (Helsinki: Otava, 1996), 250–63Google Scholar; For the intellectual influences of NPM see Hjerppe, Reino, Tutkimustyötä ja kehittämistä (Helsinki: VATT, 1980), 8–11Google Scholar, 14–5.

65 Horn, Gerd Rainer, The Spirit of '68. Rebellion in Western Europe and North America, 156–1976 (Oxford: Oxford University Press 2009), 1–4Google Scholar. For the original analysis see, for example, Poulantzas, Nicolas, State, Power, Socialism (London: Verso, 1980), 25–32Google Scholar, 55–6, 169, 190.

66 Kolbe, Eliitti, traditio, murros, 338–44.

67 Jalava, Marja, The University in the Making of the Welfare State (Frankfurt: Peter Lang, 2012), 90–3Google Scholar.

68 Isohookana-Asunmaa, Tytti, Maalaisliitto-keskustan historia 5 (Helsinki: Otava, 2006), 309–20Google Scholar; Kalevi Sorsa, Kansankoti ja punamulta, 448; Seppo Salminen, Hallinnon kehittämisen painopistealueet 1980–luvulla. Pohjoismaisen rationalisointikonferenssin RAKO-82 avajaiset 1.6.1982, Hg 51, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

69 Letter of Olof Palme to Willy Brandt and Bruno Kreisky, in Brandt, Willy, Kreisky, Bruno, Palme, Olof, Demokraattinen sosialismi. Kirjeitä keskusteluja 1972–1975 (Helsinki: Tammi, 1976), 86–7Google Scholar.

70 Östberg, Kjäll, När vinden vände. Olof Palme 1969–1986 (Stockholm: Leopard, 2009), 193–4Google Scholar, 234.

71 Tiihonen, Seppo and Ylikangas, Heikki, Virka, valta, kulttuuri. Suomalaisen hallintokulttuurin kehitys (Helsinki: VAPK-kustannus, 1992), 203Google Scholar.

72 Harisalo, Risto, Rajala, Tuija and Ståhlberg, Krister, Kunnallispolitiikkaa, (Helsinki: VAPK-kustannus, 1992), 67–8Google Scholar.

73 Finnish Law 665/1967.

74 Tiihonen, Seppo and Tiihonen, Paula, Suomen hallintohistoria (Helsinki: VAPK-kustannus, 1984), 214Google Scholar.

75 Soikkanen, Hannu, Kunnallinen itsehallinto kansanvallan perusta. Maalaiskuntien itsehallinnon historia (Helsinki: Maalaiskuntien liitto, 1966), 566Google Scholar.

76 Keskushallintokomitea KM 1978:22 (Helsinki: Valtion painatuskeskus, 1978), 3–10; Osallistumistoimikunta KM 1981:54 (Helsinki: Valtion painatuskeskus, 1981) 1–2; Lähidemokratiatoimikunta KM 1982:22 (Helsinki: Valtion painatuskeskus, 1982), 1–6; Kuntien itsehallintokomitea KM 1983:3 (Helsinki: Valtion painatuskeskus, 1983), 1–3.

77 Inspiration for this close reading of the changing meanings of concepts comes from Koselleck.

78 Luonnostelua komiteamietinnon 2. lukua varten, 2, 1 Jun.1984, 1, Archives of the Committee for Decentralisation, The National Archive of Finland, Helsinki.

79 H. Aaltonen, Tehtäväsiirtojen arviointi keskushallinnon sisäisen järjestelmän kannalta, 4 Dec. 1984, 2, FO 1, Archives of the Committee for Decentralisation, The National Archive of Finland, Helsinki.

80 T. Vuorela, Hallinnon hajauttaminen byrokratian vähentämisen keinona, 11. Oct. 1985, 9, FO 7, Archives of the Committee for Decentralisation, The National Archive of Finland, Helsinki.

81 New central agencies were founded especially during the 1960s and 1970s and constituted the basic infrastructure of the welfare state. The power struggle between central agencies and the ministries had a long history.

82 hajauttamiskomitea, Hallinnon, Hallinnon hajauttaminen KM 1986:12 (Helsinki: Ministry of Finance, 1986), 12–5Google Scholar; see also H. Aaltonen, Keskustelumuistio komitean tavoitteista, 8. 3. 1984, luonnos, 6–7, FO 2, Archives of the Committee for Decentralization, The National Archive of Finland, Helsinki.

83 hallitus, Suomen, Katsaus hallinnon kehittämiseen. Eripainos liitteestä 3 hallituksen esitykseen eduskunnalle valtion tulo-ja menoarvioksivuodelle 1988 (Helsinki: Valtion painatuskeskus, 1987), 12Google Scholar.

84 Summa, H., ‘Tulosohjaus hallinnan rationaliteettina ja tekniikoina. Arvioita tulosohjauksen valtionhallintoon jättämistä jäljistä’, Hallinnon tutkimus, 2 (1995), 144–5Google Scholar; see also Seppo Salminen, ‘Tuottavuuden kohottamistarve julkishallinnossa – keinot ja mahdollisuudet, Hallinnon kehittämisen luottamuskurssi 14.10.1981’, 4, Hg 51, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki.

85 Carter, Neil, Klein, Rudolf and Day, Patricia, How Organisations Measure Success. The Use of Performance Indicators in Government (London: Routledge, 1993), 7Google Scholar.

86 The other major party in government was the Social Democratic Party.

87 The Government of Finland, Katsaus hallinnon kehittämiseen, 12.

88 Proposal, 1 Feb. 1988, Valtioneuvoston toimenpiteistä hallinnon uudistamiseksi, meeting 4/88, H64:1, Ministerial Committee on the Improvement of Administration (HALKE), Archive of Prime Minister's Office, Helsinki.

89 Stenvall, Herrasmiestaidosta, 254–7.

90 This goal was mentioned in many occasions: 19 Sep. 1985, Järjestelyosaston lausunto Resurssihallinnon organisaatiotyöryhmälle, UAC 1, The Archive of the Ministry of Finance, The National Archive of Finland, Helsinki; Ministry of Finance, Tulosbudjetointi ja tulosohjaus (Helsinki: Ministry of Finance, 1990), 36; hallitus, Suomen, Julkisen sektorin uudistaminen: hallituksen päätös julkisen sektorin uudistamiseksi (Helsinki: Valtion painatuskeskus, 1992), 2Google Scholar, 6–7.

91 Hallinnon hajauttamiskomitea, Hallinnon hajauttaminen KM 1986:1, 3–9.

92 Isohookana-Asunmaa, Keskustan historia, 372–5.

93 See, for example, ‘Pesola ja Halonen kaavailevat kunnille tehokkuusbonuksia’, Helsingin Sanomat, 2 Dec. 1989.

94 Timo Lankinen, 20 Sept. 1991, Hallinnon hajauttamishanke ja opetustoimen hallinto, H65:1, The Ministerial Committee of Improvement of Administration (HALKE), Archive of Prime Minister's Office, Helsinki.

95 Fukuyama, Francis, State Building. Governance and World Order in the Twenty-First Century (New York: Cornell University Press, 2004), 67–76Google Scholar.

96 Actually, Japanese car companies originally copied this from the United States, but in the 1980s the direction was reversed.

97 Jensen, Michael, Foundations of Organizational Strategy (Cambridge: Harvard University Press, 1998), 2Google Scholar.

98 Fukuyama, State Building, 67–76.

99 On the victory of employers over industrial democracy see Manser, Markku, Suomalaista yhteiskuntaa rakentamassa. Suomen Työnantajain Keskusliitto 1980–1992 (Helsinki: Elinkeinoelämän Keskusliitto, 2005), 330–1Google Scholar; for performance-related pay as empowerment see ‘Työryhmä esittää aluekohtaisia palkkajoustoja’, Kauppalehti, 3 Dec. 1986; ‘STK käy hyökkäykseen byrokratiaa vastaan’, Kotimaa, 3 Feb. 1987; ‘Heikki Tuominen: Kannustepalkkaa pitäisi kokeilla kaupan piirissä’, Kauppalehti, 10 Feb.1987.

100 Finnish Law 688/1992.

101 Kokonmäki, Lasse, ‘Tärkeintä on viedä uudistus loppuun’, Hallinto, 4 (1995), 8–9Google Scholar.

102 Temmes, Markku and Kiviniemi, Markku, Suomen hallinnon muuttuminen (Helsinki: Edita, 1997), 39Google Scholar.

103 On public choice theory see Buchanan, James M., Theory of Public Choice. Political Applications of Economics (Michigan: The University of Michigan Press, 1972), 135–6Google Scholar; idem, Economics. Between Predictive Science and Moral Philosophy (College Station, Texas: AM University Press, 1987), 5–20, 71–5; idem and Musgrave, Robert, Public Finance and Public Choice (Cambridge MA: MIT Press, 2001), 111–2Google Scholar.

104 Kuntien valtionosuus-ja avustusjärjestelmän kehittäminen. I Järjestelmän yleiset perusteet KM 1976:24 (Helsinki: Valtion painatuskeskus, 1976), 10–1.

105 Hallituksen periaatepäätös hallituksen toimenpiteistä julkisten menojen kasvun hidastamiseksi, 20 Jan. 1989, Minutes of the government, Archive of the State Council, Helsinki; Suomen hallitus, Julkisen sektorin uudistaminen, 9–12.

106 By the original aim, I mean the autonomy of the municipalities. With regard to the criticism see Esko Aho, Hallinnon uudistamisesta 16 Feb. 1988, 4, H65:1, The Ministerial Committee of Improvement of Administration (HALKE), Archive of the Prime Minister's Office, Helsinki; Tiihonen, Paula, ‘Hajauttaminen hallitusmuodossa’, Hallinnon tutkimus, 1 (1987), 39Google Scholar.

107 The other major party in the government was the Coalition Party.

108 Suomen hallitus, Julkisen sektorin uudistaminen, 9–12; Ministry of Finance, Talouden näkymät ja talouspolitiikan linja vuoteen 1996 (Helsinki: Ministry of Finance, 1992), 69–72.

109 Social Democratic Party Council, meeting memo, 9 Mar. 1977, 14, ALM, Helsinki.

110 Isohookana-Asunmaa, Maalaisliitto-keskustan historia 5, 474.

111 Mannermaa, Kauko, Ohjailusta kilpailuun. Suomen hallitusten kasvu-ja rakennepolitiikka vuosina 1962–1999 (Helsinki: VATT, 2007), 10Google Scholar, 107.

112 Tiihonen, Seppo, ‘Poliittisen hallitsemisen ja julkisen hallinnon kehitys 1980–2003’, in Heiskala, Risto, ed., Artikkelikokoelma tutkimushankkeesta sosiaaliset innovaatiot, yhteiskunnan uudistumiskyky ja taloudellinen menestys (Helsinki: Sitra, 2004), 60–4Google Scholar, 80.

113 Tiihonen, Seppo, From Uniform Administration to Governance and Management of Diversity. Reforming State Functions and Public Management in Finland (Helsinki: Ministry of Finance, 2000), 4Google Scholar.

114 Timo Luhtala, ‘Suomi ja Ruotsi panostavat eniten T&K-toimintaan’, Tieto & trendit, 6 (2010).

115 Lemola, Tarmo, ‘Tiede- ja teknologiapolitiikan muotoutuminen’, in Tommila, P., ed., Suomen tieteen historia 4 (Helsinki: WSOY, 2002), 482Google Scholar; see also Särkikoski, Tuomo, Sitra – tulevaisuus tehtävänä (Helsinki: Edita, 2007), 269–80Google Scholar.

116 Kaukiainen, Yrjö, Pihkala, Erkki, Hoffman, Kai and Harmo, Matti, Sotakorvauksista vapaakauppaan (Helsinki: KTM, 1988), 284–8Google Scholar.

117 Lemola, ‘Tiede- ja teknologiapolitiikan muotoutuminen’, 482; see also Reinboth, Ritva, ‘Valtionosuudet supistuvat ensi vuosituhannelle saakka’, Hallinto, 4 (1995), 3–4Google Scholar.

118 See, for example, Meeting of the Social Democratic Party Council, appendix 443, Teollisuuspoliittinen työryhmä, Teollisuuspoliittinen muistio 22.10.1982, 2, Ca 94, The Archive of the Labour Movement, Helsinki; Koivisto, T., ‘Aluepolitiikan uudistus on välttämätön’, in Pakarinen, Pete and Varila, Kirsi, eds., Kokoomus? (Helsinki: Kansallinen sivistysliitto, 1993), 27Google Scholar.

119 Vartia, Pentti and Ylä-Anttila, Pekka, Kansantalous 2028 (Helsinki: Taloustieto, 2005), 236Google Scholar.

120 Kantola, Anu, ‘Kilpailukyky politiikan valtastrategiana’, in Kaisto, J. and Pyykkönen, M., eds., Hallintavalta. Sosiaalisen, politiikan ja talouden kysymyksiä (Helsinki: Gaudeamus, 2010), 103Google Scholar, 110–3.

121 Porter, Michael, The Competitive Advantage of Nations (New York: Free Press, 1990)CrossRefGoogle Scholar.

122 Särkikoski, Sitra – tulevaisuus tehtävänä, 246–54, 273–9.

123 In 1992 70 per cent of venture capital was public.

124 Särkikoski, Sitra – tulevaisuus tehtävänä, 291, 301.

125 Gray, John, False Dawn. The Delusions of Global Capitalism (London: Granta Books, 1998), 28Google Scholar; Gray, John, Endgames: questions in late modern political thought (Cambridge: Polity Press, 1997), 104–5Google Scholar, 113–4.

126 Peck, Constructions of Neoliberal Reason, 9–10, 15–21.

127 Arrighi, Giovanni, The Long Twentieth Century (London: Verso, 2009), 219–46Google Scholar.

128 Jensen, Lotte and Wanna, John, ‘Better guardians?’, in Wanna, John, Jensen, Lotte and de Vries, Jouke, eds., Controlling public expenditure: the changing roles of central budget agencies (Northampton: Edward Elgar, 2003), 251–5Google Scholar.

129 Roberts, The Logic of Discipline, 23–96, 140–6.

130 Mirowski, Phillp, Never let a serious crisis go to waste: how neoliberalism survived the financial meltdown (London: Verso, 2013), 84Google Scholar.