IDEAS home Printed from
   My bibliography  Save this article

A critical assessment of transaction cost theory and governance of public services with special reference to water and sanitation


  • Hulya Dagdeviren
  • Simon A. Robertson


This paper aims to provide a critical assessment of Oliver Williamson’s work on the choice between public and private governance by focusing on his central proposition that public governance should be considered as an organisation of last resort when all else fails. Our primary argument is that Williamson’s work on public governance reflects an underdeveloped framework, mostly focusing on sovereign administration, and is not suitable for application to a host of other public services. It has the potential to corroborate any governance form that limits the usefulness of transaction cost theory (TCT) as an instrument of analysis and prediction. Although Williamson characterises TCT as an empirical success story, our application of it to the public–private dilemma for the water and sanitation sector finds very little historical and contemporary validity in this view.

Suggested Citation

  • Hulya Dagdeviren & Simon A. Robertson, 2016. "A critical assessment of transaction cost theory and governance of public services with special reference to water and sanitation," Cambridge Journal of Economics, Oxford University Press, vol. 40(6), pages 1707-1724.
  • Handle: RePEc:oup:cambje:v:40:y:2016:i:6:p:1707-1724.

    Download full text from publisher

    File URL:
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:cambje:v:40:y:2016:i:6:p:1707-1724.. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.