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The Proper Scope of Government: Theory and Application to Prisons
Abstract
When should a government provide a service in-house and when should it contract out provision? The authors develop a model in which the provider can invest in improving the quality of service or reducing cost. If contracts are incomplete, the private provider has a stronger incentive to engage in both quality improvement and cost reduction than a government employee has. However, the private contractor's incentive to engage in cost reduction is typically too strong because he ignores the adverse effect on noncontractible quality. The model is applied to understanding the costs and benefits of prison privatization. Copyright 1997, the President and Fellows of Harvard College and the Massachusetts Institute of Technology.
... The equity structure of a business is being increasingly focused on and considered as a factor affecting the corporate governance process and performance measurement according to Short (1994) and Shleifer and Vishny (1997). Investors are always interested in maximizing profits, therefore, the structure of a business is always of great importance, affecting the ability to meet the profit needs of shareholders. ...
... Indeed, the goal of each shareholder is to maximize profits, so the equity structure cannot be separated from this goal. The equity structure determines the profit each shareholder receives based on his or her respective ownership ratio of shares in the enterprise according to Shleifer and Vishny (1997). Jensen and Meckling (1976) introduced a concept of an enterprise's equity structure to refer to capital allocated within the company -directly managed by the enterprise, and outside the company -not directly managed by enterprise. ...
... Some researchers have demonstrated that companies with less state ownership tend to be more efficient. Hart et al. (1997) and Shleifer (1998) advocate for private ownership due to a perceived lack of incentive for cost reduction and quality improvement within government agencies. Boycko et al. (1994Boycko et al. ( , 1996a argue that the inefficiencies plaguing State-Owned Enterprises (SOEs) are rooted in the pursuit of political agendas, inherent political control, and the resulting disputes over ownership rights with external shareholders. ...
This study aims to evaluate the impact of transparency of budget structure on risk of getting into financial distress in Vietnam. The article uses data regarding equity proportion from the financial reports of business entities on Hanoi Stock Exchange (HNX), divided into four main categories, namely large ownership, institutional ownership, managerial ownership, and state ownership ratio, to find the relation between the allocation of equity and the chance a company having financial failure. From the mentioned information, the research attempts to explain the relations, as well as suggestions for companies to prepare and avoid financial distress from an equity structure perspective. Results from the study’s sample show insignificant correlations between the share of owners and financial distress situation of a company, which plays a part to help the overall estimation of risk in businesses as a whole.
... Besides, the private partner also has reasons to prefer engaging in PPPs in which it takes on more of the project's risks. That is to say, bundling responsibilities in private partners leads to a temporary allocation of property rights to the private contractor, which could enlarge the scope for efficiency gains (Grossman and Hart, 1986;Hart et al., 1997;Hart, 2003). The private contractor will have more incentives to perform efficiently since controlling rights over a project's assets will allow it to operate the asset for a longer period and under more favourable conditions (Wang et al., 2018a). ...
... Following transaction cost theory, the separation allows researchers to home in on the efficiency of resource allocation, minimize transaction costs, and comprehend the direct financial impact on private participants (Williamson, 2016). Simultaneously, indirect government support, including contingent liabilities and guarantees, reduces uncertainties influencing the overall transaction environment without immediate financial transfers (Hart et al., 1997). Analysing these uncertainties independently provides insights into their impact on transaction efficiency and the risk profile associated with government policies. ...
... These empirical findings endorse the reasoning developed in section 2. Bundling responsibilities in the private partner alleviates opportunistic behaviours of the private partner consisting of underinvesting during the construction phase of the project, since it would jeopardize the private contractor's interests during the operation phase (Nisar, 2007). The temporary allocation of greater property rights to the private contractor that occurs under PPP types where the private partner takes more responsibilities broadens the scope of activities in which private involvement can contribute to enhancing efficiency and ameliorates the conditions in which the private contractor operates the assets (Grossman and Hart, 1986;Hart et al., 1997;Hart, 2003;Wang et al., 2018a). PPPs in which the private partner can participate in more activities could be more attractive for private investment due to more opportunities to do business. ...
... Governments can reduce costs by outsourcing services to external suppliers who are often eager to work efficiently because they can claim the residuals from the increased profits gained through cost reduction (Hart et al., 1997;Thompson, 2011). When there is enough market competition, contracting governments can reap the benefits of competition among vendors by accepting bids from those offering the lowest price (Petersen et al., 2018). ...
... Transaction costs theory argues that organizations' decision to internalize or contract out service production is based on obtained net benefits between transaction costs and potential cost savings (Williamson, 1996). A noncompetitive vendor market and information asymmetry between contracting governments and contactors are two key drivers of higher transaction costs in service outsourcing Hart et al., 1997;Prager, 1994). If the transaction costs exceed the direct cost savings achieved by shifting from the in-house production of public services to outsourcing, governments' fiscal burdens increase, negatively affecting their fiscal conditions. ...
... Moreover, information asymmetry between contracting governments and service vendors may result in the opportunistic behaviors of the latter, thus discounting the benefits of contracting out public services (Hart et al., 1997;Prager, 1994). The ultimate goal of service contractors, especially that of for-profit private firms, is presumably to maximize their revenues and profits. ...
Scholars have long regarded government fiscal stress as a crucial factor driving public service outsourcing; however, further investigation is still needed to determine whether service outsourcing in turn helps governments improve fiscal conditions. Public choice theory suggests that outsourcing services can lead to efficiency improvement and cost savings. Nevertheless, transaction costs theory implies that the costs associated with service outsourcing may offset or even outweigh its potential benefits. Moreover, the extent of transaction costs depends on contextual factors such as market competition, bureaucrat support, and government management capacity. Empirically, we employ an instrumental variable estimation approach to examine the impact of service outsourcing on the budget balances and debt levels of U.S. municipalities. We find that service outsourcing improves government fiscal conditions, with contextual factors playing an important role in moderating this effect. Additionally, outsourcing services to different types of contractors has varying implications for government fiscal conditions.
... The literature on economic outcomes, such as that of Hart et al. (1997), suggests that governments tend to pay special attention to political and social objectives, such as low production prices, employment, or external effects on profitability. Therefore, government ownership, through aspects inherent to the owner's identity, can represent different desires from those of private ownership (Willner & Parker, 2007) in terms of the order of priority of the company's objectives. ...
... Governments tend to pay special attention to political and social objectives such as low production prices, employment or external effects on profitability (Hart et al., 1997). On the other hand, privately-owned companies, supported by the economic rationality of private owners, will seek ways to increase their abnormal returns. ...
The aim of this article was to examine the effect of tariff changes, moderated by capital ownership, on the abnormal return of Brazilian public utility companies. Based on the capture perspective, regulation can be captured by the regulated party, and capital ownership can shape the pressure from companies on the regulator for regulatory decisions that are favorable to their interests. This issue has not yet been investigated. In the regulatory process, the regulator's decisions generally involve increasing the administered price. As a result, the legitimacy of the regulator is questioned, suggesting that its decisions are biased towards the interests of companies. This study sheds light on this issue. The evidence shows how the private identity of the controlling owner can lead the company to earn a return above the cost of capital through the regulatory process. The sample consisted of regulated companies (from the water and sanitation, piped natural gas and electricity sectors) from 2007 to 2019. The variables used were: abnormal return (dependent); tariff change and capital ownership (independent); and leverage, economic growth, size and sector. The data were estimated using a random effects model, generalized least squares and robustness using a dynamic panel with GMM-SYS (all observations). The results show that the private identity of the owner of the capital can lead to regulatory decisions that are more aligned with the interests of maximizing the profitability of the regulated companies. The results are consistent with the perspective of the economic rationality of private investors to maximize returns and the perspective that public investors prioritize other outcomes rather than abnormal returns.
... A literatura acerca do resultado econômico, a exemplo de Hart et al. (1997), sugere que os governos tendem a prestar atenção especial a objetivos políticos e sociais, como preços baixos de produção, emprego ou efeitos externos relativos à lucratividade. Portanto, a propriedade do governo, por meio de aspectos inerentes à identidade do proprietário, pode representar anseios diferentes aos da propriedade privada (Willner & Parker, 2007) em relação à ordem de prioridade dos objetivos da empresa. ...
... Os governos tendem a prestar atenção especial a objetivos políticos e sociais, como preços baixos de produção, emprego ou efeitos externos relativos à lucratividade (Hart et al., 1997). De modo contrário, as empresas de propriedade privada, amparadas na racionalidade econômica dos proprietários privados, buscarão formas de aumentar seus retornos anormais. ...
Resumo O objetivo deste artigo consistiu em verificar o efeito da mudança tarifária, moderado pela propriedade do capital, no retorno anormal de empresas brasileiras do setor de utilidade pública. Com base na perspectiva da captura, a regulação pode ser capturada pelo regulado, e a propriedade do capital pode modelar a pressão das empresas sobre o regulador por decisões regulatórias favoráveis a seus interesses. Tal indagação ainda não foi investigada. No processo regulatório, as decisões do regulador geralmente envolvem o aumento do preço administrado. Como consequência, a legitimidade do regulador é questionada, sugerindo que suas decisões têm sido tendenciosas aos interesses das empresas. Este estudo coloca luz sobre o tema. As evidências fornecem informação sobre como a identidade privada do proprietário controlador pode levar a empresa a obter retorno superior ao custo do capital por meio do processo regulatório. A amostra foi composta por empresas reguladas (setores de água e saneamento, gás natural canalizado e energia elétrica), no período de 2007 a 2019. As variáveis utilizadas foram: retorno anormal (dependente); mudança tarifária e propriedade do capital (independentes); e alavancagem, crescimento econômico, tamanho e setor. Os dados foram estimados por meio de um modelo de efeitos aleatórios, método dos mínimos quadrados generalizados; e robustez usando painel dinâmico com GMM-SYS (todas as observações). Os resultados apontam que a identidade privada do proprietário do capital pode conduzir a decisões regulatórias mais alinhadas aos interesses de maximização da rentabilidade das empresas reguladas. Os resultados se alinham à perspectiva da racionalidade econômica dos investidores privados à maximização dos retornos e à perspectiva de que os investidores públicos priorizam outros resultados, em vez de retornos anormais
... Yet the specific ownership status of private suppliers is also what distinguishes them from one another (Amirkhanyan et al., 2018;Meier et al., 2021). Contrary to public service providers, private forprofit providers can extract profit by lowering costs and/or reducing service quality (Andersen et al., 2023;Hart et al., 1997;Petersen et al., 2022). ...
... In contrast, nonprofit providers are driven less by the incentive to extract profit and thus more inclined to signal credibility and aligned interests in producing high-quality services (Arrow, 1963;Park & Brunjes, 2022). With restrictions to financial redistribution and stronger value-driven commitments to the public interest, nonprofit providers are often perceived as less likely to respond opportunistically, such as by reducing service quality (Glaeser & Shleifer, 2001;Hart et al., 1997). As public and both nonprofit and for-profit private providers are common in most public service markets, it is thus reasonable to expect that citizens are sufficiently familiar with their differences to effectively distinguish between them. ...
Despite a growing number of studies on how prior beliefs distort citizens' interpretation of performance information for service providers, little is known about whether prior beliefs matter equally across different services and types of providers. In this study, we provide a wide replication and extension of the experimental design used in Baekgaard and Serritzlew (2016) with three types of providers (public, non‐profit, and for‐profit) across two services (nursing homes and refuse collection). Based on two large‐N nationally representative experiments (N = 3018 and N = 3020), we find that citizens' sector preference does indeed impact their interpretation of performance information, corresponding to the original study. However, public sector preference plays a substantially different role in the two services. Our findings strengthen the external validity of previous research and simultaneously identify theoretical boundaries to its application across various services and providers. This, we argue, underlines the importance of replicating and extending pivotal studies on performance information.
... Public sector organizations are adopting private sector business models, such as incentivization, resource discipline with an emphasis on finding less costly ways to deliver services, and focusing on results or "hands on" control by management (Hood 1995;Cordery and Narraway 2008). Aspects of incentivization may not optimally serve the public interest (Hart et al. 1997;Dunleavy, Margetts, Bastow, and Tinker 2006). This may be especially true if the compensation scheme aligns with organizational economic efficiency, as employees may be willing to compromise public service quality in the process of cutting costs, and contracts may not adequately guard against this possibility (Hart et al. 1997). ...
... Aspects of incentivization may not optimally serve the public interest (Hart et al. 1997;Dunleavy, Margetts, Bastow, and Tinker 2006). This may be especially true if the compensation scheme aligns with organizational economic efficiency, as employees may be willing to compromise public service quality in the process of cutting costs, and contracts may not adequately guard against this possibility (Hart et al. 1997). New Public Management (NPM) was introduced as part of the restructuring of public sector organizations as they became decentralized and more "corporatized" (Lapsley 1999;Cainarca, Delfino, and Ponta 2019). ...
Changes in public sector management systems have resulted in public sector organizations adopting business models similar to private corporations. Using two experiments that vary in the service quality provided to public sector constituents, this study examines how different incentive schemes impact public sector employees’ decision-making. We find that performance-based incentive schemes in the public sector increase employees’ self-interest and lead them to focus more on maximizing their personal wealth (which is aligned with organizational economic efficiency) at the expense of service quality to public sector constituents (i.e., public interest). However, we also find that employees’ decisions are more focused on service quality and less on wealth maximization when their decisions may negatively impact public sector constituents. Overall, we find that employees who receive fixed compensation are more likely to consider how their decisions impact public service quality and are less likely to focus on personal wealth maximization.
JEL Classifications: H11; L33; M21; M41.
... The costs involved in monitoring public contracts are often too high for resource-constrained governments to meet and contractors regularly face little pressure from competitors. As a result, contractors are incentivized to prioritize cost-cutting over quality; which is often called "quality shading" (Domberger and Jensen 1997;Hart, Shleifer, and Vishny 1997). ...
... The practice of sacrificing quality in favor of cost-cutting, commonly called "quality shading," has long been a concern of the literature on contracting out and seriously threatens the potential gains from contracting (Domberger and Jensen 1997;Hart, Shleifer, and Vishny 1997;King and Pitchford 1998;Lopez-de-Silanes, Shleifer, and Vishny 1997;Sclar 2000). Studies have documented the practice of quality shading across several service areas, including prisons and detention centers (Alonso and Andrews 2016;Austin and Coventry 2001;Bauer and Johnston 2020;Bedard and Frech 2009;Greene 1999;Lindsey, Mears, and Cochran 2016;Logan 1990), job-market programs (Anderson, Burkhauser, and Raymond 1993;Bedard and Frech 2009;Courty and Marschke 1997;Greer, Schulte, and Symon 2018), health and social care (Amirkhanyan, Kim, and Lambright 2008;Bedard and Frech 2009;Elkomy, Cookson, and Jones 2019;Jilke, Van Dooren, and Rys 2018;King and Pitchford 1998;Young and Macinati 2012), as well as telecoms and waste management (King and Pitchford 1998). ...
How does contracting out affect service performance? Evidence to date is mixed. We argue that this is partially due to prior studies focusing often on whether—not how—services are contracted. Yet, how services are contracted matters. In particular, we argue that whether users pay user fees for services to contractors affects efficiency. Where they do, contractor revenue depends on user satisfaction and contractors face incentives to provide quality services to users to retain revenue. Where, by contrast, governments fund services, information asymmetry about the quality of services users receive allows contractors to shirk quality. The assertion is substantiated by empirical evidence derived from a comprehensive analysis of conditional efficiency within the water supply services across 2,111 municipalities in Spain, employing a two-stage conditional order-m data panel estimation. Our results show that contracting out where users pay service fees and thus have incentives to hold contractors accountable outperforms contracting out without user fees in quality-adjusted service provision.
... Second, while there are enticing accounts of public bureaucracies successfully encouraging innovation (Kelman, 2021), there is general agreement that private ownership provide stronger incentives for efficiency, cost savings, and innovative activities (Shleifer, 1998). Yet, the profit motive's high-powered incentives can be a double-edged sword in the welfare sector, a fact that scholars operating from different perspectives in the field of New Institutional Economics (NIE) recognize (Bowles, 2016;Hart et al., 1997;Shleifer, 1998). Welfare services such as education are credence (or trust) goods whose value consumers cannot fully assess on their own (Dulleck & Kerschbamer, 2006), making them particularly susceptible to producer manipulation. ...
... Corruption, favoritism, collusion, absence of competition, and problems with the project itself are classic issues in the PPP (Bosio et al., 2020). Private companies have a strong motive to bribe public officers to cut out competitors, to admit lower quality, or increase payments (Hart et al., 1997). But unlike private buyers, public agencies often lack the incentives and administrative capacity to handle these challenges (Bosio et al., 2020). ...
Bid Responsiveness in the public procurement process (PPP) is a crucial aspect of public construction projects. A responsive bid materially complies with the form or content requirements of the bidding documents; the responsiveness of a bid is determined during the bid evaluation period. Accepting low-responsive bids can lead to project failures and unexpected adverse consequences. The Public Procurement Systems (PPS) in developed countries frequently used systematic mechanisms to enhance the quality of the PPP which includes enhancing the responsiveness of bids. This study revealed six dominant factors impacting responsiveness and five systematic mechanisms more prominently discussed in the PPS in developed countries to enhance the quality of the PPP. The population of this study consists of procurement specialists in Sri Lankan public construction procurement at the pre-contract stage and among those who have more than 20 years of experience in PPP were considered as the sampling frame. The fuzzy-set theory was used to determine the ranking order of these systematic mechanisms based on their influence to enhance responsiveness by overcoming the impact of dominant factors. Suggestions were made for Sri Lankan PPS to implement these systematic mechanisms.
... Corporatization however can face soft budget constraints which diminish incentives to minimize production costs as the government might tolerate losses and continue to finance the firm (Armstrong and Sappington 2006). Hart et al. (1997) develop a model in which a provider chooses to invest in improving quality or reducing the costs of a specific service. This suggests that the case for privatization is stronger when quality-reducing cost reductions may be controlled through contracts or competition or when quality improvements are important and patronage and powerful unions are a problem, as is the case in air traffic control (Blondiau et al. 2018). ...
Many industries requiring large and extensive networks are served by monopolistic infrastructure providers. Such networks may often suffer from congestion during peak periods. We analyze the effects of auctioning congestable service provision for the market in the case of natural monopolies, where competition in the market is not an option. The procurement auction includes a reward and penalty scheme as a function of service quality. We characterize the properties of the auction mechanism in which oligopolistic customers choose optimal combinations of servers, creating a network congestion game where serial and parallel competition play a role. The model is subsequently applied to the Western European air traffic control market, which handles 50% of the European airline traffic. EU Member States each introduce a procurement auction and air navigation service providers bid to operate air traffic control in one or more regions for a pre-specified period of time. The results suggest that introducing competition for the market via outsourcing service provision leads to social cost efficiency and a substantial reduction in charges. In addition, the incentives are likely to lead to defragmentation of the European air traffic control market, were providers to win auctions in adjacent regions. We note that it is important to ensure at least two competitors for the auction process to remain successful over time hence suggest a cap on the market share served by any one geographical monopolist.
... State-owned banks, often viewed as less efficient and profitable compared to private banks, have faced criticism due to their management by political bureaucrats. Undesirable consequences such as resource misallocation and value erosion can arise due to political interference and inefficiencies [44][45][46][47][48][49]. The misallocation of funds by state-owned banks can be attributed to two main hypotheses: the soft-budget constraints hypothesis and the rent-seeking hypothesis. ...
This chapter explores the potential role of development banks in fostering innovation within the context of sustainable development, considering their explicit mandates and collaborations with governments. Development banks are argued to play a pivotal role in supporting innovation by providing substantial financial resources to projects that address the complex challenges outlined in the Sustainable Development Goals (SDGs) while ensuring the preservation of natural resources for future generations. A critical review of economic literature examines the characteristics of development banks that enable them to fulfill their social mandate, including their expertise and ability to mobilize private finance. Collaboration with governments and risk mitigation for private investors are highlighted as means to facilitate the achievement of the SDGs. However, challenges associated with public intervention and state-owned enterprises, such as political opportunism and crowding-out of private sector investment, are acknowledged. By reviewing the literature, describing recent developments, and presenting empirical evidence, this research provides valuable insights for policymakers, scholars, and practitioners to critically evaluate the potential and effectiveness of development banks in promoting innovation.
... With the introduction of competition, it is claimed that private sector producers are forced by competitive pressure to optimize efficiency, while public organizations operate in a monopoly situation. Other theoretical work has placed greater emphasis on ownership considerations instilling an expectation that public sector agencies lack incentives to perform while private sector ownership models will incentivize investment in improvements or innovations in the way services are delivered and in finding measures to reduce costs (Andersson et al., 2019;Hart et al., 1997). Ronald Coase (1937) introduced the concept of transaction costs economics (TCE) as a framework for analyzing the choice between organizing economic transactions within firms or through marketized arrangements that extend beyond the boundary of the firm. ...
Outsourcing of public services is under heightened scrutiny. Public managers are asked to conduct thorough "make or buy" assessments to help assure deliverabil-ity, affordability, and value for money of public services. The naivety of this request dramatically overlooks the subtlety and challenge faced by public managers. In this paper we connect a range of differently configured contractual agreements to underlying components of "value for money", namely, the pursuit of economy, efficiency and effectiveness. We set out a framework consisting of conceptual models and the corresponding decision tree to allow comparison across alternative sourcing strategies, considering both the associated transaction costs and transaction benefits. We also use simulation methods to capture uncertainty while establishing the practicality of the framework. This study advocates for moving beyond the polarized 'make or buy' debate with more instrumental considerations of "how to buy" from the perspective of the public manager. K E Y W O R D S outsourcing, PPPs, public decision making, transaction cost economics , value for money This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.
... And even from within economics, the account of privatization provided thus far is recognized as incomplete. In particular, it fails to take account of the added "transaction costs" (Coase, 1937;Williamson, 1985) involved in setting up, monitoring and enforcing contracts, or the risk that private managers will obtain cost savings by "cutting corners" rather than through genuine (and difficult) service innovation (Hart, Shleifer and Vishny, 1997). Indeed, the higher the chance of this "quality shading" (Elkomy, et al., 2019) -perhaps because of the difficulty of measuring performance or of anticipating and contractually forestalling all the methods by which corners could be cutthe higher the transaction costs incurred. ...
Inter‐municipal cooperation is often regarded as an alternative to privatizing local public services. But cooperation and privatization can also be combined into a dual reform package in which several municipalities jointly issue contracts relating to multiple jurisdictions. Evaluation of these mixed cooperation‐privatization reforms rests on disentangling the separate and combined effects of each strategy. This we undertake for the case of solid waste collection in Catalonia, using environmental protection as our focal performance standard. Drawing on two waves of data (for 2000 and 2019) for 186 municipalities that together use all four combinations of public, private, single and cooperative service delivery, we show that superior environmental performance was initially confined to conventional cooperations involving only public production. But latterly, any form of cooperation, using public or private production, resulted in significant gains. This reinforces the need for evaluators to isolate the “active ingredient” in composite reforms.
... on the technological innovation of SOEs Innovative activities are different from the general economic impact of enterprises, which has the characteristics of high risk, high investment, long cycle and heterogeneity (Hirsh • leifer et al., 2012). According to the political and managerial perspectives described above, the policy objectives and management system of SOEs are difficult to incentivise innovation (Hart et al., 1997). Some scholars believe that the "mixed reform" of SOEs promotes innovation, reduces state control through the participation of non-state shareholders, improves management incentives (Cai Guilong et al., 2018), reduces the agency cost of enterprises, and promotes the investment of enterprises in innovation (Li Wengui and Yu Minggui, 2015). ...
The Third Plenary Session of the 18th CPC Central Committee established mixed ownership system as the main policy of SOE reform, and as the main form of SOE "mixed reform", can non-state shareholders' participation promote the technological innovation of SOE? Based on the research samples of China's A-share state-owned listed companies from 2010 to 2017, this paper finds that the participation of non-state shareholders promotes the technological innovation of SOE, and this result is more robust when the participation of non-state shareholders exceeds 10%, i.e., when the participation of non-state major shareholders is more robust. The results of the mediation effect model show that non-state shareholders' equity participation plays a positive role in the level of state-owned technological innovation by improving the incentive channel for executive compensation, while the results of the mediation effect test of the financial assets investment channel are not verified. This paper provides theoretical and empirical support for the rationality and effectiveness of mixed ownership reform from the dimension of technological innovation.
... First, our research speaks to the studies on governance within a top-down bureaucracy, particularly when the system involves multitasking agency problems. Theoretically, within the multitasking framework, an agent will prioritize tasks that are strongly incentivized by clearly observed outcomes over poorly measurable, weakly incentivized ones (Holmstrom and Milgrom, 1991;Baker, 1992;Hart et al., 1997;Dewatripont et al., 1999). Whether governments could monitor their officials' multitasking efforts could significantly alter the execution of public policies and, subsequently, the overall social welfare (Dixit et al., 1997;Dixit, 2002). ...
... Keskeisenä haas teena erityisesti terveyspalveluiden hankinnoissa on laadun mittaaminen. Lisäksi on vaarana, että tuottajien kannusteet kehittää muita kuin kilpai lutuksessa mitattavia laadullisia tekijöitä voivat heikentyä (8). Tästä syystä on tärkeää, että han kinnan tekevä organisaatio pystyy kuvailemaan palvelun vaatimusehdot riittävällä tarkkuudella palvelukuvauksessa ja tarjouspyynnössä. ...
... For "social" view, state-owned banks can help to overcome market failures, take advantage of externalities, and promote socially desirable welfareenhancing investments (Atkinson & Stiglitz, 1980). For "agency" view, however, the agency costs associated with a government bureaucracy (e.g., the conflict of interests between the government and the bureaucrats designated to manage stated-owned banks) can give rise to operational inefficiencies and capital misallocation (Banerjee, 1997;Hart et al., 1997). ...
... In addition to the top-down political pressures, economic pressures have never been lifted in emerging markets. Regional governments are primarily responsible for sustaining steady economic development and the basic livelihoods of local people (Hart, Shleifer, and Vishny 1997). As an essential strength in the market, FDIs have greatly contributed to local economic growth and employment rates (Tan and Wang 2011). ...
The pollution haven hypothesis (PHH) is widely used to explain the predatory relocation of foreign investors to emerging markets. However, the long-term effect of the PHH remains a mystery, given the natural evolution of environmental regulations. This study proposes that the likelihood of foreign divestment in the emerging market increases when the regional environmental regulatory pressure becomes more stringent. Empirical support is obtained through a Cox proportional hazard model of 402 international joint ventures established in China in 2000, whose foreign divestment status is traced until 2017. The findings support the karmic debt of the PHH, that is, foreign investors’ focus on avoiding environmental regulatory costs by relocating to emerging markets in the short run will backfire in the long run unless they bring something of value to the host market.
... Failures are less costly and learning costs lower in small fi rms because small values are at stake (Lucas, 1978). 13. Hart et al. (1997Hart et al. ( , p. 1131 argue that the focus on quality changes from innovative activities diff ers from traditional approaches in the literature on regulation and procurement, for example, Laff ont and Tirole (1993), who study issues such as adverse selection and moral hazard stemming from incomplete information in contracting. 14. ...
... Second, while there are enticing accounts of public bureaucracies successfully encouraging innovation (Kelman 2021), there is general agreement that private ownership can provide stronger incentives for efficiency, cost savings, and innovative activities than public ownership (Shleifer 1998). That said, economists are not blind to the fact that the profit motive's high-powered incentives can be a double-edged sword in the welfare sector (Hart et al. 1997;Shleifer 1998;Bowles 2016). Welfare services such as education are credence (or trust) goods whose value consumers cannot fully assess on their own (Dulleck and Kerschbamer 2006), making them particularly susceptible to manipulation by producers. ...
... In the property rights approach as developed by Grossman and Hart (1986), Hart and Moore (1990), and Hart (1995), the ownership structure leads to the residual control rights. In the PLS contracts allocation of the right to tale decision in case not mentioned prior in the contract to the principal (Islamic Bank) or the agent (entrepreneur) can play the role of incentives (Hart et al., 1997;Laffont & Martimort, 2002). ...
Information frictions limit the adoption of new agricultural technologies in developing countries. Efforts to improve learning involve spreading information from government agents to farmers. We show that when compared to this government approach, informing private input suppliers in India about a new seed variety increases farmer-level adoption by over 50 percent. Suppliers become more proactive in informing potential customers and carrying the new variety. They induce increased adoption by those with higher returns from the technology. Being motivated by expanded sales offers the most likely motive for these results. (JEL D83, L14, L33, O13, O32, Q12, Q16)
There is one thing I always remember from my time in middle school: if you took California out of America, it would be the sixth largest economy in the world! At the time, I thought to myself, if the US is made up of 50 states, it must be wealthy beyond imagination.
Public health systems are dominant in much of the world, but often face fiscal constraints that lead to rationing of care. As a result, private sector healthcare providers could in theory beneficially supplement public systems, but evaluating the benefits of private alternatives has been challenging. We evaluate a private supplement to the free public health system for one of the world’s deadliest health problems, diabetes. We estimate enormous impacts of the private supplement, increasing the share of those treated who are under control by 69%. This effect arises through both improved treatment compliance and health behavior. We find diabetes complications fall in the short run, and that the net costs of this intervention are one-third of the gross costs. The returns to private care do not appear to reflect more productive delivery but rather more attachment to medical care, offering lessons for improving the public system.
As in many countries around the globe, older citizens in long-term care facilities (LTCFs) in Sweden were hit hard by the Coronavirus pandemic, but mortality varied greatly between different facilities. Current knowledge about the causes of this variation is limited. This article closes this gap by focusing on the link between the structural characteristics of LTCFs—ownership, size, and staffing—and the risk of dying from COVID-19 in Sweden during 2020. Having utilized both individual- and facility-level data, our results suggest that lower staff turnover, having a nurse employed at the facility, and smaller facility size are associated with an decreased risk of dying from COVID-19. Ownership type is not directly associated with COVID-19-related mortality, but public facilities have lower staff turnover and fewer personnel with additional employment than privately run facilities, while privately run LTCFs more often have a nurse employed at the facility.
O objetivo desta pesquisa é examinar a literatura sobre contratações públicas nacionais e internacionais aderentes à abordagem teórica da Análise Econômica do Direito. Em seguida, analisar a parcela da literatura sobre contratações públicas cujo enfoque seja na mitigação dos custos de transação e promoção do bem-estar social, convergindo os conceitos de eficiência e justiça. Isto é, mostra-se em que medida pesquisadores se preocupam em antever os efeitos das alterações na legislação de licitações para evitar a implementação de regras e incentivos ineficazes ou injustos e reduzir a ineficiência e os elevados custos de transação do processo de contratações públicas. Os resultados sugerem que uma parte significativa da literatura sobre contratações públicas não é fundamentada em teoria, isto é, e se limitam à análises de natureza empírica Esse baixo percentual de pesquisas fundamentadas em teoria é mais frequente em periódicos nacionais da administração e em periódicos com foco em contratações públicas. Essa constatação é um sinal de que a literatura sobre contratações públicas pode não estar madura e que se encontra aberta para novas abordagens teóricas.
We examine the effect of minority state ownership on firm performance using the Chinese stock market crash in 2015. We find that treatment firms with minority state ownership accumulated from governmental purchases of equities experience significant reductions in operating performance. The negative impact is more severe in firms with higher riskiness and firms with less powerful large shareholders. We also find that treatment firms’ risk decreases and their employment increases after minority state shareholders step in, providing supportive evidence on the government's motives of reducing risk and preventing mass layoffs. Further tests reveal the channels through which minority state ownership impedes investment efficiency, productivity, and innovation. The negative impact diminishes when government institutions divest their shares in a timely manner. Overall, our results suggest there are unintended negative consequences of minority state ownership arising from the governmental rescue package in a market crisis.
This study aims to measure the preferences and valuations of parents of students with myopia parents for eye care service attributes in rural China, and to quantify the potential welfare impacts of privatization policy on children’s eye care services.
A discrete choice experiment was designed and implemented among a sample of parents of children with myopia in rural China. We randomly selected 350 participants from the list of subjects obtained from local town schools and family doctors using a random number table method. The participants were asked to choose between two hypothetical scenarios defined by five attributes: provider type, distance, price, lenses type, and refractionists’ professional competencies. We estimate conditional logit and mixed logit models to approximate individual preferences for these attributes and estimate the welfare effects by calculating willingness to pay.
Respondents (n = 336) showed a significant preference for public providers of refractive error services, myopia control lenses, and professional refractionists (P < 0.01 for each). Consumer welfare losses due to a prohibition of the public provision of refractive error services could be compensated by improving the quality of products and services delivered by private providers. Lastly, both parent and child demographics and previous experience of eye care service consumption are important predictors of willingness to pay for refractive error services.
The privatization policy on children’s eye care services would not cater to the preferences of rural consumers, inevitably leading to welfare losses. However, reduced consumer welfare could be compensated by improving the quality of products and service delivery from private providers. These results could help inform strategies to improve and reduce inequities in access to high-quality eye care services in rural China.
Cet article évalue la perception, par les hauts responsables du secteur public, de l’impact des réformes de type « nouvelle gestion publique » dans les pays européens. À partir des données d’une enquête menée dans 20 pays européens, nous examinons le lien entre cinq importantes réformes mises en œuvre dans le cadre de la nouvelle gestion publique (réduction des effectifs, création d’agences, externalisation, orientation client et adoption de pratiques d’emploi flexibles) et quatre aspects de la performance du secteur public : coûts et efficience, qualité des services, cohérence et coordination de l’action publique, et égalité d’accès aux services. La modélisation par équations structurelles révèle que l’assimilation des usagers des services à des clients et la flexibilité de l’emploi sont positivement corrélées à l’amélioration de ces quatre aspects de la performance. L’externalisation et la réduction des effectifs sont toutes deux positivement corrélées à l’amélioration de l’efficacité, mais la réduction des effectifs est également associée à une baisse de la qualité des services. Il n’existe pas de lien entre la création d’agences autonomes et la performance. Cela permet de penser que les décideurs qui entendent moderniser le secteur public doivent accorder la priorité aux réformes managériales au sein des administrations publiques plutôt qu’aux transformations d’ordre structurel. Remarques à l’intention des praticiens Cet article apporte aux praticiens un éclairage approfondi sur la manière dont les hauts responsables du secteur public perçoivent l’impact des réformes de type « nouvelle gestion publique » sur un certain nombre d’aspects de la performance. Il leur permet de mieux appréhender la relation entre les stratégies de réformes et leurs résultats dans l’administration européenne et de comparer leurs expériences à celles des hauts responsables d’autres pays.
Amid an aging population and a growing role for private equity (PE) in the care of older adults, this paper studies how PE ownership affects U.S. nursing homes using patient-level Medicare data. We show that PE ownership leads to a patient cohort with lower health risk. However, after instrumenting for the patient-nursing home match, we find that PE ownership increases mortality by 11%. Declines in measures of patient well-being, nurse staffing, and compliance with care standards help to explain the mortality effect. Overall, we conclude that PE has nuanced effects with adverse outcomes for a subset of patients.
We study public versus private provision of health care for veterans aged 65 and older who may receive care provided by the US Department of Veterans Affairs (VA) and in private hospitals financed by Medicare. Utilizing the ambulance design of Doyle et al. (2015), we find that the VA reduces 28-day mortality by 46 percent (4.5 per centage points) and that these survival gains are persistent. The VA also reduces 28-day spending by 21 percent and delivers strikingly different reported services relative to private hospitals. We find suggestive evidence of complementarities between continuity of care, health IT, and integrated care. (JEL H51, I11, I12, I18, J14)
Cet article s’intéresse au recours au secteur privé dans les prisons françaises à partir de 1987, en le mettant en perspective avec le mouvement de privatisation des structures pénitentiaires dans le monde anglo-saxon. Il avance deux principaux résultats. D’une part, la privatisation recoupe dans le secteur pénitentiaire des sens et des significations variés selon les contextes nationaux. Le modèle français (la gestion déléguée) apparaît alors intermédiaire en comparaison des autres pays étudiés : bien que moins extensive qu’aux États-Unis ou au Royaume-Uni, la gestion déléguée est à présent le modèle de référence de gestion des prisons et concerne une part de la population carcérale bien supérieure à celle de ses voisins européens. D’autre part, la privatisation est loin d’être le synonyme d’une disparition de l’État : l’administration pénitentiaire sous-traite ou délègue plus qu’elle ne se retire totalement. L’État tend à déplacer son champ d’action vers une activité de contractualisation et de contrôle participant à la formalisation et la rationalisation du fonctionnement des prisons déléguées.
In this chapter, we examine how the states and municipalities govern the non-economic aspects of the ECEC sector in the five Nordic countries. We study the use of hard governance tools, like legislation and supervision, and the use of national curriculum. We also study softer means of governance like the use of manuals and evaluative steering. The core question is: have the more diverse set of providers of ECEC that we documented in Chap. 4 resulted in more active regulation, steering, and supervision from the public sector? We find growing use of state steering in a sector where much discretion has traditionally been left to the local level—municipalities and individual units. Further, we also see a growing use of manuals and evaluative steering tools. Evaluative steering has a distinct nature in the ECEC field, where it is more focused on enhancement-led approaches in which the ECEC environment, curriculum, and ECEC practices are the focus of evaluation. The growing presence of for-profit providers is one reason for the enhanced public sector governance, but an increasing role for ECEC in the educational system is also a driver for increased public control of the service.KeywordsRegulationSteeringManualsECEC governanceEvaluative steeringHidden privatizationSupervision
This study examines the international alliance activities of state‐owned enterprises (SOEs). We find that country‐level political and economic factors, such as autocracy, foreign ownership restrictions, foreign currency reserve, and industry dissimilarity, increase the likelihood of SOEs’ participation in cross‐border alliances. Our analyses further reveal that foreign firms tend to collaborate with local SOEs when facing high expropriation risks and the presence of a state‐dominated banking system in the host country. Further, foreign firms experience higher announcement returns when they ally with local SOEs rather than with non‐SOEs. This result suggests that the exclusive benefits from SOEs are value‐creating for the international alliance partners. Overall, our findings provide novel insights into the determinants and wealth effect of SOEs’ engagement in international alliance activities.
Our theory of costly contracts emphasizes that contractual rights can be of two types: specific rights and residual rights. When it is costly to list all specific rights over assets in the contract, it may be optimal to let one party purchase all residual rights. Ownership is the purchase of these residual rights. When residual rights are purchased by one party, they are lost by a second party, and this inevitably creates distortions. Firm 1 purchases firm 2 when firm 1's control increases the productivity of its management more than the loss of control decreases the productivity of firm 2's management.
The potential of post-contractural apportunistic behavior for improving market efficiency through intrafirm rather than interfirm transactions is examined under the assumption that vertical costs will increase less than contracting costs as specialized assets and appropriable quasi rents increase. Vertical integration protects against the risk of contract cancellation and can create market power which is not generally referred to as monopoly. Contracts used as a alternative provide economically enforceable protection against opportunistic behavior. Solutions to opportunistic behavior problems can include joint ownership of common assets and condominium ownership of services. Economies of scale are major factors in some businesses, such as insurance. The complexities of ownership relations makes it difficult to assign higher costs to either the contract or vertical-integration approach. This suggests that economic analysis should be used to identify which is most advantageous for specific kinds of activities.
In the United States, the two principal modes of producing local government services are in-house provision by government employees and contracting out to private suppliers, also known as privatization. We examine empirically how U.S. counties choose the mode of providing services. The evidence indicates that state clean-government laws and state laws restricting county spending encourage privatization, whereas strong public unions discourage it. This points to the important roles played by political patronage and taxpayer resistance to government spending in the privatization decision.
The authors explore the twin hypotheses (1) that high-performance incentives, worker ownership of assets, and worker freedom from direct controls are complementary instruments for motivating workers, and (2) that such instruments can be expected to covary positively in cross-sectional data. They also relate their conclusions to empirical evidence, particularly that on the organization, compensation, and management of sales forces. Copyright 1994 by American Economic Association.
Organizations * Armies, Prisons, Schools * Organization Matters Operators * Circumstances * Beliefs * Interests * Culture Managers * Constraints * People * Compliance Executives * Turf * Strategies * Innovation Context * Congress * Presidents * Courts * National Differences Change * Problems * Rules * Markets * Bureaucracy and the Public Interest
Quality of confinement is compared among three women's prisons: private, state, and federal. Defined along eight dimensions, quality of confinement is measured using 333 indicators derived from institutional records and surveys of inmates and staff. A comparative Prison Quality Index summarizes the results for each prison on each dimension. While all three prisons are regarded as having been high in quality, the private prison outperformed its governmental counterparts on nearly every dimension.
This book provides a framework for thinking about economic relationships and institutions such as firms. The basic argument is that in a world of incomplete contracts, institutional arrangements are designed to allocate power among agents. The first part of the book is concerned with the boundaries of the firm. It is argued that traditional approaches such as the neoclassical, principal‐agent, and transaction costs theories cannot by themselves explain firm boundaries. The book describes a theory—the incomplete contracting or property rights approach—based on the idea that power and control matter when contracts are incomplete. If the terms of a transaction can always be renegotiated, the incentives of a party to undertake relationship‐specific investments will depend crucially on the ability to control the use of productive assets when renegotiation takes place. Asset ownership becomes an essential source of power. The theory suggests that firm boundaries are chosen to allocate power optimally among the various parties to a transaction. The foundations of incomplete contracting are also discussed.
The remainder of the book applies incomplete contracting ideas to understand the financial structure of closely held and public companies. The analysis illustrates how debt acts as an automatic mechanism to constrain the behaviour of managers or owners of both kinds of companies. In closely held companies, debt can force an entrepreneur to pay out funds to investors rather than to himself. In a public company, ownership is dispersed among small shareholders causing a separation between ownership and control. It is argued that debt and equity choices, capital structure decisions, bankruptcy procedures, corporate governance, and takeovers, play a substantial role in limiting the ability of a (self‐interested) manager to make unprofitable but power‐enhancing decisions.
Thesis (Ph. D.)--Harvard University, 1996. Includes bibliographical references.
This paper provides a framework for addressing the question of when transactions should be carried out within a firm and when through the market. Following Grossman and Hart, we identify a firm with the assets that its owners control. We argue that the crucial difference for party 1 between owning a firm (integration) and contracting for a service from another party 2 who owns this firm (nonintegration) is that, under integration, party 1 can selectively fire the workers of the firm (including party 2), whereas under nonintegration he can "fire" (i.e., stop dealing with) only the entire firm: the combination of party 2, the workers, and the firm's assets. We use this idea to study how changes in ownership affect the incentives of employees as well as those of owner-managers. Copyright 1990 by University of Chicago Press.
This paper presents a theory of competition among pressure groups for political influence. Political equilibrium depends on
the efficiency of each group in producing pressure, the effect of additional pressure on their influence, the number of persons
in different groups, and the deadweight cost of taxes and subsidies. An increase in deadweight costs discourages pressure
by subsidized groups and encourages pressure by taxpayers. This analysis unifies the view that governments correct market
failures with the view that they favor the politically powerful: both are produced by the competition for political favors.
We present a model of bargaining between politicians and managers that explains many stylized facts about the behavior of
state firms, their commercialization, and privatization. Subsidies to public enterprises and bribes from managers to politicians
emerge naturally in the model. We use the model and several extensions to understand why commercialization and privatization
might work, and what forces contribute to effective restructuring of public enterprises. We illustrate the model using examples
from several countries.
Consider an entrepreneur who needs to raise funds from an investor but cannot commit not to withdraw his human capital from the project. The possibility of a default or quit puts an upper bound on the total future indebtedness from the entrepreneur to the investor at any date. The authors characterize the optimal repayment path and show how it is affected both by the maturity structure of the project return stream and by the durability and specificity of project assets. The authors' results are consistent with the conventional wisdom about what determines the maturity structure of long-term debt contracts. Copyright 1994, the President and Fellows of Harvard College and the Massachusetts Institute of Technology.
This paper presents two propositions about corruption. First, the structure of government institutions and of the political
process are very important determinants of the level of corruption. In particular, weak governments that do not control their
agencies experience very high corruption levels. Second, the illegality of corruption and the need for secrecy make it much
more distortionary and costly than its sister activity, taxation. These results may explain why, in some less developed countries,
corruption is so high and so costly to development.
The potential usex of public resources and powers to improve the economic stuius of economic groups (such as industries and occupations) are analyzed to provide a scheme of the demand for regulation. The characteristics of the political process which allow relatively small groups to obtain such regulation is then sketched lo provide elemenls of a theory of supply of regulation. A variety of empirical evidence and illustration is also presented. W The state—the machinery and power of the state—is a potential resource or threat to every industry in the society. With its power to prohibit or compel, to take or give money, the state can and does selectively help or hurt a vast number of industries. That political juggernaut, the petroleum industry, is an immense consumer of political benefits, and simultaneously the underwriters of marine insurance have their more modest repast. The central tasks of the theory of economic regulation are to explain who will receive the
The process of selling assests and enterprises to the private sector raises questions about natural monopolies, the efficiency and equity of state-owned versus privately owned enterprises, and industrial policy. This comprehensive analysis of the British privatization program explores these questions both theoretically and empirically.
The paper discusses some specificities of the design of incentives in the public sector and their implications: multiplicity of goals, unclear weighing of these goals, and nonmeasurability of some of them; lack of comparison; heterogeneity of tastes and dispersion of principals. The paper then analyzes career concerns, associated with the prospect of reselection, promotion, or employment in the private sector, and articulated around some mission. There is a potential multiplicity of missions that can be followed by rational officials. The last part studies the division of labor within government, in particular division of labor among ministries and the use of multiple principals to control economic agents, and division of labor aimed at creating information for public decision making and the use of enfranchised advocates of specific interests. Copyright 1994 by Royal Economic Society.
This article develops a model of privatization using an incomplete contracts approach. We argue that different allocations of ownership rights lead to different allocations of inside information about the firm, which in turn affect both allocative and productive efficiency. Privatization is seen as a commitment device of the government to credibly threaten to cut back subsidies if costs are high in order to give managers better cost-saving incentives (a "harder budget constraint"). The cost of privatization is that allocative efficiency is distorted. Copyright 1996 by Oxford University Press.
Tiebout choice among districts is the most powerful market force in American public education. Naive estimates of its effects are biased by endogenous district formation. I derive instruments from the natural boundaries in a metropolitan area. My results suggest that metropolitan areas with greater Tiebout choice have more productive public schools and less private schooling. Little of the effect of Tiebout choice works through its effect on household sorting. This finding may be explained by another finding: students are equally segregated by school in metropolitan areas with greater and lesser degrees of Tiebout choice among districts.
Traditional analysis of the impact of competitive tendering on service provision has focused on costs and prices. Critics have argued that price reductions lead to lower quality. We tested this hypothesis using a two equation econometric model, with data from a panel of 61 cleaning service contracts. The results indicated that while competition reduced price significantly, quality of service was maintained or even enhanced. The effect of competition turned out to be greater on prices than on quality, and the influence of ownership appeared to be negligible on both. The evidence does not support the hypothesis that efficiency gains are traded off for lower quality. Copyright 1995 by Royal Economic Society.
Vertical Integration
- B Klein
- R Crawford
- A Alchian
Klein, B., R. Crawford, and A. Alchian, " Vertical Integration, Appropriable Rents, and the Competitive Contracting Process, " Journal of Law and Economics, XXI (1978), 297–326.
Comparative Evaluation of Privately-Managed CCA Prison and State-Managed Prototypical Prisons The Economic Theory of Regulation
- State
- Tennessee
State of Tennessee, " Comparative Evaluation of Privately-Managed CCA Prison and State-Managed Prototypical Prisons, " February 1, 1995. Stigler, George, " The Economic Theory of Regulation, " Bell Journal of Economics, II (1971), 3–21.
Privatization in the United States Design, Construc-tion and Management Service Contract between CCA and Metropolitan Gov-ernment of Nashville and Davidson County
- De-Silanes Lopez
- Andrei Florencio
- Robert W Shleifer
- Vishny
Lopez-de-Silanes, Florencio, Andrei Shleifer, and Robert W. Vishny, " Privatization in the United States, " Rand Journal of Economics (1997), Autumn. Metropolitan Government of Nashville and Davidson County, " Design, Construc-tion and Management Service Contract between CCA and Metropolitan Gov-ernment of Nashville and Davidson County, " 1990.
Economic Rationales for the Scope of Privatization The Political Economy of Private Sector Reform and Privatization
- Carl Shapiro
- Robert Willig
Shapiro, Carl, and Robert Willig, "Economic Rationales for the Scope of Privatization," in Ezra N. Suleiman and John Waterbury, eds., The Political Economy
of Private Sector Reform and Privatization (Boulder, CO: Westview Press,
1990).
Three Essays on the Economics of Governance United States Immigration and Naturalization Service, The Elizabeth, N.J., Con-tract Detention Facility Operated by ESMOR, Inc.: Interim Report Privatization: An Economic Analysis (Cam-bridge
- Cong Trinh
- Minh Vickers
- George John
- Yarrow
Trinh, Cong Minh, " Three Essays on the Economics of Governance, " Ph.D. thesis. Harvard University, 1996. United States Immigration and Naturalization Service, The Elizabeth, N.J., Con-tract Detention Facility Operated by ESMOR, Inc.: Interim Report, July 20, 1995. Vickers, John, and George Yarrow, Privatization: An Economic Analysis (Cam-bridge, MA: MIT Press, 1988).
Private Adult Correctional Facility Census (Gainesville: Center for Studies in Criminology and Law
- Charles W Thomas
Thomas, Charles W., Private Adult Correctional Facility Census (Gainesville: Center for Studies in Criminology and Law, 1995).
Privatizing the Public Sector: How to Shrink Government
- Emanuel Savas
Savas, Emanuel, Privatizing the Public Sector: How to Shrink Government (Chatham, NJ: Chatham House Publishing, 1982).
Comparative Evaluation of Privately-Managed CCA Prison and State-Managed Prototypical Prisons
- State Of Tennessee
State of Tennessee, "Comparative Evaluation of Privately-Managed CCA Prison
and State-Managed Prototypical Prisons," February 1, 1995.
Design, Construction and Management Service Contract between CCA and Metropolitan Government of Nashville and Davidson County
- Metropolitan Government
- Davidson Nashville
- County
Metropolitan Government of Nashville and Davidson County, "Design, Construction and Management Service Contract between CCA and Metropolitan Government of Nashville and Davidson County," 1990.
- Oliver Hart
Hart, Oliver, Firms, Contracts, and Financial Structure (Oxford: Oxford University Press, 1995).
Contract Detention Facility Operated by ESMOR
- The Elizabeth
United States Immigration and Naturalization Service, The Elizabeth, N.J., Contract Detention Facility Operated by ESMOR, Inc.: Interim Report, July 20,
1995.
The Political Economy of Private Sector Reform and Privatization
- Carl Shapiro
- Robert Willig