Among the many assumptions about public management widely embraced but
rarely tested is the notion that public sector managers are more aver
se to risk than managers in the private sector. Taking a multivariate
measure of ''risk culture,'' this study seeks to identify and to expla
in differences between public and private organizations. The concept o
f risk culture pertains to managers perceptions that their co-workers
and superiors take risks and promote risk-taking. Some of the factors
examined as possible determinants of risk culture include political co
ntrol nature of reward systems, levels of formalization and red tape,
bureaucratic structures, and goal ambiguity. Using questionnaire data
from a variety of public and private organizations we find that there
is considerable variance in organizations' risk culture but the sector
of an organization tells us little about its risk culture. Risk cultu
re is, however wall accounted for by the various explanatory factors e
mployed here. Particularly, a riskier culture is positively related to
the willingness of top managers to trust employees and to the clarity
of organizations' missions. Organizations with more red tape, weak li
nks between promotion and performance, and high involvement with elect
ed officials tend to have a less risky culture.