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Property rights and transaction costs : The role of ownership and organization in German public service provision

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  • Friese, Maria
  • Heimeshoff, Ulrich
  • Klein, Gordon J.

Abstract

This paper provides evidence that ownership and organization matters for the efficiency of provision of public services. In particular, we find that pure private ownership is more efficient than pure public ownership, followed by mixed ownership. The delegation of management in different legal forms also has an impact, highlighting the importance of the design of the government-operator relation. We apply a structural approach of production function estimation ensuring precise determination of total factor productivity for a panel of German refuse collection firms in the time period between 2000-2012. We project total factor productivity estimates (TFP) on ownership and organization. Our results are in line with the trade-offs implied by the property rights literature and provide important policy implications regarding the organization of public service provision.

Suggested Citation

  • Friese, Maria & Heimeshoff, Ulrich & Klein, Gordon J., 2016. "Property rights and transaction costs : The role of ownership and organization in German public service provision," Arbeitspapiere 173, University of Münster, Institute for Cooperatives.
    • Handle: RePEc:zbw:wwuifg:173
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    Cited by:

    1. Marko Krause & Alexander Lahmann, 2023. "The tax advantage of public firms over private firms in the German household solid waste disposal industry," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 94(2), pages 549-574, June.
    2. Gabriel Natividad, 2022. "Decentralizing investment: Evidence from municipal organization after close elections," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 31(3), pages 734-761, August.

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    More about this item

    Keywords

    incentive regulation; productive efficiency; refuse collection; public utility;
    All these keywords.

    JEL classification:

    • L00 - Industrial Organization - - General - - - General
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • L97 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Utilities: General

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