On Publicly Provided Services – Public or Private Production?

Eero Lehto

No 211, Working Papers from Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE

Abstract: This study focuses on the production services which are purchased by the government. We consider whether the delivery of the service should be public or private. The social impact of the service is determined by the satisfaction of unforeseen individual needs. Assuming that the information about these needs is ex post observed only by the supplier of the service favours public production. Auctioning the right-toproduce contract, however, selects the most cost-e±cient private supplier. Whether private production is optimal resolves from the trade-o® between cost e±ciency and a failure in meeting individual needs. We also analyse investments in monitoring.

Keywords: service production; public or private and auction (search for similar items in EconPapers)
JEL-codes: D44 L24 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2005-02-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://labore.fi/wp-content/uploads/2005/02/Tyopapereita-211.pdf First version, 2005 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pst:wpaper:211

Access Statistics for this paper

More papers in Working Papers from Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE Contact information at EDIRC.
Bibliographic data for series maintained by Jaana Toivainen ().