Arm’s Length Provision of Public Services

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dc.contributor.author	Schultz, Christian	en_US
dc.contributor.author	Bennedsen, Morten	en_US
dc.date.accessioned	2009-02-04T10:27:50Z
dc.date.available	2009-02-04T10:27:50Z
dc.date.issued	2007-12-05T00:00:00Z	en_US
dc.identifier.uri	http://hdl.handle.net/10398/7602
dc.description.abstract	We analyze the economic consequences of strategic delegation of the right to decide between public or private provision of governmental service and/or the authority to negotiate and renegotiate with the chosen service provider. Our model encompass both bureaucratic delegation from a government to a privatization agency and electoral delegation from voters to a government. We identify two powerfull effects of delegation when contracts are incomplete: The incentive effect increases the incentive part of service providers’ remuneration and we show that strategic delegation may substitute formal incentive contracts. The bargaining effect improves the bargaining position vis a vis a private firm with market power and leads to a lower price for the service. Outsourcing, Strategic Delegation, Incentives, Incomplete Contracting, Market Power, Representative Democracy.	en_US
dc.format.extent	41 s.	en_US
dc.language	eng	en_US
dc.relation.ispartofseries	Working paper;2007-7	en_US
dc.title	Arm’s Length Provision of Public Services	en_US
dc.type	wp	en_US
dc.accessionstatus	modt07dec05 nijemo	en_US
dc.contributor.corporation	Copenhagen Business School. CBS	en_US
dc.contributor.department	Økonomisk Institut	en_US
dc.contributor.departmentshort	ECON	en_US
dc.contributor.departmentuk	Department of Economics	en_US
dc.contributor.departmentukshort	ECON	en_US
dc.idnumber	x656555628	en_US
dc.publisher.city	København	en_US
dc.publisher.year	2007	en_US