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Do Public Sector Reforms Get Rusty? Local Privatization in Spain

  • Germa Bel
  • Anton Costas

Recent evidence on the savings from private production of local public services has become increasingly ambiguous. Here we specify and estimate a model to explain municipal costs for solid waste collection. As we find no effect of the mode of production on costs, we put forward two hypotheses. First, progressive concentration and decreases in bidding competition may come to outweigh gains from privatization. Second, the threat of privatization may have stimulated public unit managers to search for alternative reforms. The results suggest that both inter-municipal cooperation and recent privatization are associated with lower costs, while old privatization is not.

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Article provided by Taylor & Francis Journals in its journal Journal of Economic Policy Reform.

Volume (Year): 9 (2006)
Issue (Month): 1 ()
Pages: 1-24

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Handle: RePEc:taf:jpolrf:v:9:y:2006:i:1:p:1-24
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  28. Stefan Szymanski, 1993. "Cheap rubbish? Competitive tendering and contracting out in refuse collection, 1981-88," Fiscal Studies, Institute for Fiscal Studies, vol. 14(3), pages 109-30, August.
  29. Scott J. Callan & Janet M. Thomas, 2001. "Economies of Scale and Scope: A Cost Analysis of Municipal Solid Waste Services," Land Economics, University of Wisconsin Press, vol. 77(4), pages 548-560.
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