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THIRD THOUGHTS ON CONTRACTING OUT

By Bruce L. Benson and Like Many Libertarians

Abstract

without question the idea that contracting out for government services was a good idea. After all, it puts production back into the hands of relatively efficient private producers. However, after reviewing the literature on contracting out for law enforcement services (Benson 1990, pp. 179-99), I had some second thoughts, concluding that while contracting out might solve some problems of government inefficiency, other more serious problems would remain. Nonetheless, I continued to cling to the idea that contracting out was better than nothing, noting (pp. 195-96) that the major criticisms of the government production of law and order are not alleviated by contracting out. One problem-bureaucratic inefficiency-may be partly overcome if corruption and the bureaucratic tendencies for over-regulation do not eventually destroy the potential for such benefits. But, the other problems remain. Private firms under contract to the government will produce what interest groups want, not what individual taxpayers want. And contracting creates new interest groups-the contracting firms and their employees-that will demand greater output of whatever good or service they sell to the government (not unlike bureaucrats).... [It is inappropriate to assume] that contracting for services will necessarily reduce the size of the resource pool controlled by government, particularly the number of persons dependent on public funds

Year: 2013
OAI identifier: oai:CiteSeerX.psu:10.1.1.352.7349
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