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Bureaucracy, organizational redundancy, and the privatization of public services.
Abstract
If there exists an idea common to both privatization theory and evidence, it is that a simple transfer of a service from a public monopoly to a private one is unlikely to yield improvements in either service quality or cost. Does zero redundancy in service delivery then promote optimal efficiency as many reform efforts contend? Using data from a large sample of cities, Miranda and Lerner demonstrate that service delivery arrangements that mix private or nonprofit sector production with same in-house government production are generally cost effective. In some instance, such arrangements may be more cost effective than exclusive production by the private sector consistent with arguments made by Landau and Niskanen. The evidence in this study suggests that the deliberate introduction of redundancy can improve organizational and system performance.
Journal
(1995)
vol55
no1
pages193-200
Categories
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Managing External Relations
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Public-Private Partnerships
