CityEconomist

The Power of Comparative Analysis

Comparisons among government entities, as with comparisons among companies, can be valuable for assessment and policy. 

The comparative analysis of the Council on Municipal Performance has yielded important, surprising findings:
- The cities with the most active public economic development programs were also those with the biggest economic problems.
- Cities where the private sector was prepared to take the lead in economic development had the most success.
- Cities with the most police officers had the highest crime rates.
- The most segregated U.S. city was Chicago, not somewhere in the deep south.
- Cities that attempted to solve their own management problems by privatization, failed.
- The cities that used privatization successfully were ones that were able to manage their services well already.
- Government agencies have shown they can compete successfully on price and quality with private providers.

Comparative analysis is critical for public policy. For example:
- In a time of economic recession, a state government wishes to assist troubled localities. In The Wealth of Cities, the Council on Municipal Performance showed that a state's taxing the better-off counties or cities to assist the worse off has limitations, just as does the taxing of better-off citizens to help the poorer.
- This issue is in part one of resources and in part one of incentives.
- Comparative analysis is helpful in this situation for a number of reasons. If the troubled localities rank poorly by some national measure, it strengthens the state's case for Federal assistance.  
- In either case, to correctly and promptly trigger the direction and amount of aid, a comparative analysis is required to establish a threshhold of distress.