Choice and competition in public service provision
In spite of a range of policy initiatives in sectors such as education, health care and legal services, whether choice and competition is valuable remains contested territory. This paper studies the impact of choice and competition on different dimensions of quality, examining the role of not-for-pr...
| Main Authors: | , |
|---|---|
| Format: | Working paper |
| Published: |
University of Oxford
2016
|
| _version_ | 1797084139162173440 |
|---|---|
| author | Besley, T Malcomson, J |
| author_facet | Besley, T Malcomson, J |
| author_sort | Besley, T |
| collection | OXFORD |
| description | In spite of a range of policy initiatives in sectors such as education, health care and legal services, whether choice and competition is valuable remains contested territory. This paper studies the impact of choice and competition on different dimensions of quality, examining the role of not-for-profit providers. We explore two main factors which determine whether an alternative provider enters the market: cost efficiency and the preferences of an incumbent not-for-profit provider (paternalism). The framework developed can incorporate standard concerns about the downside of choice and competition when consumer choice is defective (an internality) or choice imposes costs on those who do not switch (an externality). The paper considers optimal funding levels for incumbents and entrants showing when the “voucher” provided for consumers to move to the entrant should be more or less generous than the funding for consumers who remain with the incumbent. Finally, the model also offers an insight into why initiatives are frequently opposed by incumbent providers even if the latter have not-for-profit objectives. |
| first_indexed | 2024-03-07T01:51:10Z |
| format | Working paper |
| id | oxford-uuid:9a220979-762e-4fb3-b42b-15c5e75f8718 |
| institution | University of Oxford |
| last_indexed | 2024-03-07T01:51:10Z |
| publishDate | 2016 |
| publisher | University of Oxford |
| record_format | dspace |
| spelling | oxford-uuid:9a220979-762e-4fb3-b42b-15c5e75f87182022-03-27T00:19:15ZChoice and competition in public service provisionWorking paperhttp://purl.org/coar/resource_type/c_8042uuid:9a220979-762e-4fb3-b42b-15c5e75f8718Symplectic Elements at OxfordUniversity of Oxford2016Besley, TMalcomson, JIn spite of a range of policy initiatives in sectors such as education, health care and legal services, whether choice and competition is valuable remains contested territory. This paper studies the impact of choice and competition on different dimensions of quality, examining the role of not-for-profit providers. We explore two main factors which determine whether an alternative provider enters the market: cost efficiency and the preferences of an incumbent not-for-profit provider (paternalism). The framework developed can incorporate standard concerns about the downside of choice and competition when consumer choice is defective (an internality) or choice imposes costs on those who do not switch (an externality). The paper considers optimal funding levels for incumbents and entrants showing when the “voucher” provided for consumers to move to the entrant should be more or less generous than the funding for consumers who remain with the incumbent. Finally, the model also offers an insight into why initiatives are frequently opposed by incumbent providers even if the latter have not-for-profit objectives. |
| spellingShingle | Besley, T Malcomson, J Choice and competition in public service provision |
| title | Choice and competition in public service provision |
| title_full | Choice and competition in public service provision |
| title_fullStr | Choice and competition in public service provision |
| title_full_unstemmed | Choice and competition in public service provision |
| title_short | Choice and competition in public service provision |
| title_sort | choice and competition in public service provision |
| work_keys_str_mv | AT besleyt choiceandcompetitioninpublicserviceprovision AT malcomsonj choiceandcompetitioninpublicserviceprovision |