Factors influencing the choice of the public service producer
| Title in English | Factors influencing the choice of the public service produce |
|---|---|
| Authors | |
| Year of publication | 2009 |
| Type | Article in Proceedings |
| Conference | State and Administration in a Changing World. |
| MU Faculty or unit | |
| Citation | |
| Field | Economy |
| Keywords | Public-private Partnerships; public service; provision; demand for public services |
| Description | Local government guarantees wide spectrum of public goods and services as a result of public choice. Within this concept local governments must face pressure of their citizens on quality and quantity of various public services. Therefore public subjects are forced on looking for the most efficient public service providing method because of limited public financial sources. Hence public service (co)financing is given to the forefront. Private (co)financing is realized through different types of Public private partnerships (PPP). As this method has many pros and cons, it is quite difficult for local government to get the better value for money. It is possible only through professional decision-making process of public service providing. As a result of many researches on this field (Ochrana (2007), Beblavý (2007), Pavel, Němec, Meričková), public sector - local government (especially municipalities) is behind with this area. The paper analyses, how selected economic criteria of decision-making process (such as public service characteristic, public service providing costs, public service demand) influence the choice of (1) the public services provider and (2) public services financing method. The contribution is based on the hypothesis that any public service (both collective and toll good) guaranteed by the public authority (local government) could be provided by the private organisation as well. Therefore the choice of relevant provider is logically focused on choosing the one who will guarantee better service quality and cost effectiveness (in other words, the better value for money). The aim of this paper is to specify basic principles which the public service guarantor (local government) should respect during the decision-making process.This model is subsequently being tested for concrete municipal public services. The first part of the paper identifies and discusses the crucial characteristics of public services based on the relevant literature review. In the second part, the selected economic criteria are then analyzed in order to specify the optimal provider (public/private; for profit/not for profit) for different types of local public services. The author designs a scheme which determines optimal type of provider and optimal financing method for local public services. This scheme is tested on the Czech municipalities in the concluding part of the paper. |