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Mba5004 week 5 discussion

Mba5004 week 5 discussion

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MBA5004 Week 5 Discussion

Government’s Effectiveness in Public Service Provision

Private sector dynamism has repeatedly been politicized to suggest that government

involvement in public service delivery is the cause of inefficiency. The perception that the

private sector is dynamic and efficient, while the public sector is inefficient and wasteful is

incorrect. The efficiency of service provision under each model of ownership depends on the

economic sector, the level of competition, autonomy in recruitment and management, as well

as the financial and legal obligation involved. Based on this view, government institutions can

be as effective as and even more efficient than private sector institutes in service provision

within specific divisions of the economy.

There is no conclusive evidence that private sector institutions are better in service

provision than public sector agencies. In the past, variations have been observed on the level

of efficiency portrayed by private or public sector agencies in different economic sectors

(Rao, 2015). For instance, higher efficiency has been witnessed among private institutes in the

education sector. Similarly, public sector institutes display higher efficiency in the healthcare

sector than their compatriots in the private sector. These variations indicate that making a

side-by-side comparison of the effectiveness of private and public sector institutes will

generate incorrect conclusions.

In recent decades, the public official working has been perceived as incompetent,

inefficient, ineffective, and incapable of providing equitable services. The range of models

used to compare public and private sector service fail to examine the existing conditions that

increase and decrease efficiency in the different ownership styles (Rao, 2015). There are

different conditions in each service sector that promotes the operation of a public or private

sector agency. Efficiency differences within a nation’s service providers should be examined

using these varying conditions that determine how an institution will perform in its duties

towards the consumers.

Economists distinguish between the conditions that make private or public sector

suitable for service provision by defining private and public goods and services. Purely

private goods and services are defined as the commodities whose consumption is limited to

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individuals. Once an individual consumes a private good, the commodity is unavailable for

consumption by all other consumers. Such goods facilitate the balance between supply and

demand, which increases private sector efficiency in provision of these goods and services.

On the other hand, public goods are defined by their availability to all consumers even

after consumption by an individual. These commodities do not follow the shifts in the demand

and supply curve because there is little competition among consumers for them. Public sector

institutes thrive at provision of goods and services with minimal competition for consumption

such as healthcare and sanitation (Arora & Chong, 2018). Private sector institutes have higher

efficiency in industries that have competition for the goods and services provided. Examples

of industries that benefit from the private sector include agriculture and technology sectors.

Public sector institutions are more effective in provision of specific services such as

healthcare and security because they provide universal access of these goods. The healthcare

system requires public sector provision because universal coverage plans require large

funding and more legal control (Rao, 2015). The healthcare sector is one area where public

official working provides superior services to those of private working. Private sectors

perform poorly in this economic division because the system requires equitable service

provision to all the consumers while disregarding the profit-maximization objective. Although

the healthcare industry has both private and public sector providers, the public sector has

higher efficiency.

Consequently, the issue of efficiency by service providers narrows down to

institutional quality by the firm. The public sector can potentially outperform the private

sector in most economic divisions if the institution’s management has the autonomy of

recruitment and management that is present in private entities. Public entities require their

management to display high commitment towards public health, public education, social

security, and infrastructure without political affiliation (Arora & Chong, 2018). Institutional

quality is significant in improving service delivery from the public sector in all areas of an

economy, provided that political influence is eliminated in government entities.

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MBA5004 Week 5 Discussion Government’s Effectiveness in Public Service Provision Private sector dynamism has repeatedly been politicized to suggest that government involvement in public service delivery is the cause of inefficiency. The perception that the private sector is dynamic and efficient, while the public sector is inefficient and wasteful is incorrect. The efficiency of service provision under each model of ownership depends on the economic sector, the level of competition, autonomy in recruitment and management, as well as the financial and legal obligation involved. Based on this view, government institutions can be as effective as and even more efficient than private sector institutes in service provision within specific divisions of the economy. There is no conclusive evidence that private sector institutions are better in service provision than public sector agencies. In ...
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