Complexity Theory: A New Way to Look at New Public Management

Abstract

In the last three decades, there has been a worldwide wave of modernization and reform affecting the public sector. This movement reflected on the study of public administration by moving to New Public Management (NPM) which draws on new institutional economics (NIE) and private sector managerialism. The main hypothesis of NPM is that greater market adaptation in the public sector will lead to a more effective and more efficient form of government. From this, the postmodernist movement emerged as a critique of the positivistic public administration with its single-dimensional objective epistemology. Complexity theory has emerged as an important theoretical vehicle for understanding public sector management. With its unique perspective towards public sector management, complexity theory extends beyond a predetermined, single dimensional analysis, and provides a more comprehensive and holistic approach that takes into account the reality that the given situation may be subject to unforeseen and uncontrollable factors. This paper aims to examine the role of complexity theory in the study of public sector management. With its origins in natural science, complexity theory is an evolutionary approach that is often considered to be a subset of Systems Theory.  In order to clearly understand the significant contribution of complexity theory to the explanation and understanding of public sector management, one must draw parallels between NPM, with its relatively linear and deterministic vision to public sector management, and the nonlinear complex theoretical approach. As such, this paper highlights the main theoretical assumptions of NPM, in accordance with its roots in new institutional economics and business-type managerialism, and then applies the lens of complexity theory to ascertain how complexity theory provides new perspectives to the study of public sector management. Finally, this paper highlights the main characteristics of the complexity approach to public administration. This section identifies the contributions of the complex approach to our understanding of the complexities of public sector management.

Keywords: Complexity Theory, Public Administration, New Public Management, Chaos Theory.