Course 2.3 AE/IES

'Public Finance and Public Choice'

Code 1316

Faculty of Economics and Business Administration

University of Maastricht

October-December 1998

Third Lecture, 11 November 1998

Dr J.G.A. van Mierlo

Associate Professor of Public Economics

University of Maastricht

1. The Assignment

1. Four questions

a. ARRANGEMENT: who arranges/decides about PROVISION?

b. PRODUCTION: who takes care of the production/who does the job?

c. PAYMENTS: who pays the producer: subsidies vs. market prices?

d. CONSUMPTION: who takes the actual consumption decision:

consumption freedom versus limits?

2. How to select the case?

a. personal interests in the case/topic/policy field

b. nearest public institution/service (territorial vs. functional government)

c. change management problems of this service

d. availability and accessibility of information

3. How to get information and data?

a. yearly financial report

b. public relations material

c. interviews with key persons

d. analysis of key documents

3. How to structure the paper?

a. institutional introduction

b. brief history: arguments for the public/private arrangement

c. public/private production: monopoly vs. competition at the supply side

d. payments: subsidies vs. market income

e. performance measurement

f. consumption: demand analysis

g. efficiency conclusions and policy advice

2. Examples of public institutions

1. Classical territorial government

-local government

-regional government

-cooperation between local/regional governments

-crossboundary cooperation (Euregio)

2. Modern functional government

-public water management authorities

-public environmental authorities

-public transportation authorities

-public health authorities

3. Public enterprises/utilities

-electric power plants

-drink water suppliers

-natural gas suppliers

-post/telecommunication

-public transport

4. Specific public services

-health care institutions

-education institutions

-theatres, museums, etc.

-police

-fire brigade

-ambulance services

-waste and garbage collection

3. Alternative Arrangements for Public Services

4. Questions

5. Additional information

Please Skip:

Figure 3.13 (Stackleberg)

Chapter 5.4.6 (Psychology)

Figure 5.15 (Quasi-market)