Public Sector Control as a Factor in Entrepreneurial Policy: the Case of Lithuania

The paper describes the development of the Lithuanian public sector control in an attempt to evaluate how its changes affect possibilities for entrepreneurship both in the public and private sectors. An analysis of change of functions, organization, and regulation over the period of past two decades is done to see how the philosophy of public sector control in Lithuania evolved and how this changed the practices of control. The data for analysis is derived from legal documents and relevant institutional reports. Controlling the public sector has usually been about democratic accountability. Currently this layer is supplemented by attempts to advance best practice in terms of efficiency. Over the past 20 years Lithuania has undergone a path similar to the one described above. As a result, however, Lithuanian public sector control system has grown in complexity and became more bureaucratized. Attempts at increasing entrepreneurship in the public sector are often matched by increased control. This paradox of increased control produces greater bureaucracy and this risks limiting entrepreneurship in both private and public sectors. And this needs to be taken to account when designing pro-entrepreneurial policies.