Starting with a description of the conflicting paradigms of the 'welfaremodel' and the neo-conservative 'market-model' the problems of efficiency in the public sector are analyzed. The neo-conservative critique, it is argued, has drawn attention to several important problems and short-comings in public sector management. But the critique is blinded by an idealized picture of a free market system and does not realize the advantages of the public sector as a production system. The essential problems of public sector efficiency, and ways of dealing with these problems, are discussed in terms of measurements, management and mobilization.
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