In a recent article, Susan Feigenbaum and Ronald Teeples (1983) highlight an important omission in the public-versus-private, production-efficiency literature. They note the possibility that differences in product quality might explain apparent differences in efficiency. They, however, fail at the more fundamental task of accurately measuring differences in economic costs in their study of public and private water utilities. More generally, Feigenbaum and Teeples's methodology is not well suited for an analysis of the relative efficiency issue.
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