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Explaining Privatization Failure: The Vice of Sweet Carrots and Hard Sticks

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  • Roland Zullo

Abstract

Why does contracting underperform in the production of publicly financed goods? Producers for private markets survive through marketism, defined as the strategic exclusion of segments of a community, whereas producers of publicly financed goods are pressured to be inclusive. Inclusivity is achieved through universalism, an operational mode with three requisites: (1) a workforce with lateral competency to respond to contingencies, (2) interfunction asset sharing and coordination, and (3) an environment that protects professional discretion. Universalism and marketism are divergent strategies, and public-private contracts cannot cost-effectively resolve their incongruities. JEL Classification: L330, H410, P260

Suggested Citation

  • Roland Zullo, 2019. "Explaining Privatization Failure: The Vice of Sweet Carrots and Hard Sticks," Review of Radical Political Economics, Union for Radical Political Economics, vol. 51(1), pages 111-128, March.
    • Handle: RePEc:sae:reorpe:v:51:y:2019:i:1:p:111-128
    DOI: 10.1177/0486613417718527
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