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Social Heterogeneity and Optimal Mix Between Public and Private Provision of Public Goods
| Content Provider | Semantic Scholar |
|---|---|
| Author | Wang, Yongqin Xu, Haibo |
| Copyright Year | 2007 |
| Abstract | With a framework of incomplete contract, this paper shows that for provision of public goods such as medicare and education, pure privatization may not promote competition. On the contrary, the co-existence of public and private provision may enhance de facto competition. Two competitive effects are identified. When consumers are heterogeneous, the co-existence of public and private ownership gives consumers freedom to choose from different ownership, improving allocation efficiency (Tiebout effect). While consumers are homogeneous, the co-existence can promote yardstick competition, squeezing out information rents from both ownerships, improving production efficiency (benchmarking effect). In either case, the co-existence dominates unique ownership. The paper ends up with some implications for China.s medicare and education reforms. |
| Starting Page | 201 |
| Ending Page | 217 |
| Page Count | 17 |
| File Format | PDF HTM / HTML |
| DOI | 10.1007/s11366-007-9014-2 |
| Alternate Webpage(s) | http://www.cces.cn/cces/newstxt/social%20heterogeneity%20and%20optimal%20mix%20between%20public%20and%20private%20provision%20of%20public%20goods.pdf |
| Alternate Webpage(s) | https://doi.org/10.1007/s11366-007-9014-2 |
| Volume Number | 12 |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
