PUBLIC ENTERPRISE: THE NEXUS BETWEEN ORGANIZATION AND CONTROL

An appropriate control framework for public corporations must reflect the distinctive organizational features of this policy instrument. There are circumstances where it is desirable to undertake public production, and to do so through a corporate structure. But the advantages of public production are unlikely to be realized where the control system involves a contractual-type arrangement between the government and the public firm. Alternatively, too close direction may undermine the advantages of using a corporation rather than a government department. Both current discussion and current practice reveal an inadequate appreciation of the nexus between organization and control.