Fiscal Austerity and Public Servant Quality
AbstractIn this paper we use a simple model to analyze the forces which determine the size of the public sector and the quality of workers employed in that sector. Workers are heterogeneous, and the public sector chooses an employment strategy which maximizes a social welfare function $U(s,Y)$ which depends on the share of the labor force employed in public service $s$ and private sector output $Y$. The government is fully informed about worker productivity. By examining the welfare properties of the possible outcomes, we are able to illuminate situations in which policies which seek to constrain the public sector may or may not improve economic efficiency.
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Bibliographic InfoPaper provided by EconWPA in its series Public Economics with number 9705003.
Length: 15 pages
Date of creation: 12 May 1997
Date of revision: 09 Jun 1997
Note: Type of Document - Postcript prepared on Win95 Scientific Workplace; to print on PostScript; pages: 15; figures: included.
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Public Sector Efficiency; public sector labor markets; fiscal constraints;
Other versions of this item:
- H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
- J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets
- H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
- H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods
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