Multiple principals, multiple problems: Implications for effective governance and a research agenda for joint service delivery

Abstract

The multiple principal problem refers to multiple collective action problems that organizations face when they must balance (competing) interests of multiple stakeholders under joint service delivery. It negatively affects different types of organization, yet we know little about how organizations (can) mitigate it. We expand a framework based on principal–agent theory, review the literature, and consider implications for effective governance of joint service delivery in the public sector. We observe that joint service delivery can lead to free‐riding and duplication in monitoring, lobbying by principals, and increased autonomy for agents, leading to inefficiency. We build a research agenda and tentatively suggest, based on the literature, that an interface approach, where an elected unitary actor is placed in a middle tier between politics and service delivery, might best mitigate the multiple principal problem, which is currently not dealt with effectively in public management.