Incentives, Choice, and Accountability in the Provision of Public Services

This paper discusses a theoretical framework to study the issuesof competition and incentives without relying on the standardprofit-oriented ‘market’ model in the context ofthe debates about public-service reform in the UK. It uses theidea that the production of public services coheres around amission, and discusses how decentralized service provision canraise productivity by matching motivated workers to their preferredmissions. Our focus on competition and incentives cuts acrosstraditional debates about public versus private ownership andallows for the possibility of involving private non-profit organizations.We also address concerns about the consequences of allowingmore flexibility in mission design and competition on inequality.