The Theory and Practice of Managed Competition.

Managed competition can be an effective strategy for reducing costs and improving the quality of service delivery. The author presents the theoretical foundation and empirical evidence for this concept.

The reinventing government movement has been centered on the idea that competition can and is being used by governments at all levels to change how services are being financed and delivered. While the roots of this movement can be traced back at least 200 years, the systematic practice of some of its ideas is a relatively recent phenomenon. One of the main insights of the book Reinventing Government is that public and private monopolies can both undermine government performance. As the authors of Reinventing Government acknowledge, "it is one of the enduring paradoxes of American ideology that we attack private monopolies so fervently but embrace public monopolies so warmly." [1]

Nearly 40 years ago, in a seminal article in the field of public administration, the idea of separating provision and production of public services was argued to improve the effectiveness of government:

The separation of the provision of pu...

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