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Competition and Efficiency in Publicly Funded Services

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  • Jens Lundsgaard

Abstract

This paper reviews the extent to which OECD countries have opened the provision of publicly funded services to competition among public and private suppliers. The paper lays out an analytical framework identifying the inherent incentive and efficiency issues associated with the provision of publicly funded services and outlines how they may be addressed via performance-related funding, benchmarking, contracting-out by public agencies and voucher schemes which allow users to choose among suppliers while maintaining public funding. Also, the empirical literature on contracting-out of technical and support services and on school choice is reviewed. In compulsory education, the provision mode is relatively uniform across OECD countries with most students by far attending public schools. However, the involvement of private institutions increase with education level and orientation towards occupational skills, and in many countries funding arrangements for public institutions are being ... Concurrence et efficacité dans les services financés par le secteur public Cette étude examine dans quelle mesure les pays de l'OCDE ont ouvert l'offre de services financés par l’Etat à la concurrence entre fournisseurs publics et privés. Elle définit un cadre analytique pour identifier les problèmes intrinsèques d'incitation et d'efficience associés à la prestation de services financés par l’Etat et montre brièvement comment ceux-ci peuvent être résolus avec un financement lié aux résultats, des analyses comparatives, des contrats de sous-traitance par les organismes publics et des programmes de coupons, de façon à permettre aux usagers de choisir entre plusieurs fournisseurs tout en maintenant les financements publics. Par ailleurs, le document passe en revue les études empiriques sur la sous-traitance des services techniques et de soutien et sur le choix de l'établissement scolaire. Au stade de la scolarité obligatoire, le mode de prestation est relativement uniforme dans l'ensemble des pays de l'OCDE, la très grande majorité des élèves fréquentant l’école ...

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File URL: http://dx.doi.org/10.1787/282126010667
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Bibliographic Info

Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 331.

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Date of creation: 06 Jun 2002
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Handle: RePEc:oec:ecoaaa:331-en

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Keywords: efficiency and incentives; contracting; public private partnerships; user choice; vouchers; long-term care; child care; public expenditure; employment service; education; dépenses publiques; efficience et incitations; soins de longue durée; soins aux enfants; service pour l'emploi; passation de contrats; partenariats public-privé; choix de l'usager; coupons; éducation;

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Cited by:
  1. Ochel, Wolfgang, 2007. "Contracting out Employment Services Involving Temporary Agency Work in Germany," MPRA Paper 13820, University Library of Munich, Germany.
  2. Immervoll, Herwig & Barber, David, 2006. "Can Parents Afford to Work? Childcare Costs, Tax-Benefit Policies and Work Incentives," IZA Discussion Papers 1932, Institute for the Study of Labor (IZA).
  3. Behaghel, Luc & Crépon, Bruno & Gurgand, Marc, 2012. "Private and Public Provision of Counseling to Job-Seekers: Evidence from a Large Controlled Experiment," IZA Discussion Papers 6518, Institute for the Study of Labor (IZA).
  4. Pearson, Mark & Martin, John P., 2005. "Should We Extend the Role of Private Social Expenditure?," IZA Discussion Papers 1544, Institute for the Study of Labor (IZA).
  5. Wolfgang Ochel, 2004. "Competitive Tendering and Contracting of Temporary Work Agencies in Germany," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 2(2), pages 69-74, 07.
  6. Hinrichs, Karl, 2004. "Active Citizens and Retirement Planning: Enlarging Freedom of Choice in the Course of Pension Reforms in Nordic Countries and Germany," Working papers of the ZeS 11/2004, University of Bremen, Centre for Social Policy Research (ZeS).
  7. Valila, Timo, 2005. "How expensive are cost savings? On the economics of public-private partnerships," EIB Papers 4/2005, European Investment Bank, Economics Department.
  8. Elke J. Jahn & Wolfgang Ochel, 2005. "Contracting Out Temporary Help Services in Germany," CESifo Working Paper Series 1580, CESifo Group Munich.
  9. Ian Lienert, 2005. "Are Laws Needed for Public Management Reforms," IMF Working Papers 05/62, International Monetary Fund.
  10. Peter Birch Sørensen, 2004. "Outsourcing of Public Service Provision: When is it More Efficient?," EPRU Working Paper Series 04-06, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.

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