Charges as Contested Signals*

Richard Rose

Journal of Public Policy, 1989, vol. 9, issue 3, 261-286

Abstract: Government is about the supply and demand for many goods and services, but votes or social needs are the principal signal meant to give direction to public policy. Many neo-liberal economists contest this, arguing that charges or user-fees are more efficient for allocating services. Empirical analysis shows that in principle it would be possible to impose charges on three-quarters of the goods and services financed by government. Although some charges are imposed on a wide variety of public programmes, overall governments reject marketing what is marketable. Theoretical inconsistencies in government's use of charges indicate that they reflect political inertia. The conclusion offers an analytic paradigm for interpreting charges, since an accurate interpretation of the signals sent by charges depends upon attributes specific to a given public programme.

Date: 1989
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