Tuesday, April 2, 2013

Niskanen was wrong

William Niskanen was a Public Choice economist that was very influential in the Reagan administration in the US in the 1980s. Niskanen was a prominent contributor to public choice theory, a field of both economics and political science that examines the behaviour of politicians and other government officials. Public choice eschewed the traditional notion that these agents are motivated by selfless interest in the public good, and instead considered them as typically self-interested, like other agents. His chief contribution to public choice theory was the budget-maximizing model –the notion that bureaucrats will attempt to maximize their agency's budget and authority.
Since then, Niskanen's theories have been very much discredited by the observation that many public sector workers have intrinsic motivations and a public-sector ethos that replace the sharp monetary incentives that are supposed to prevail in the private sector. Of course, some public servants fulfil Niskanen's assumptions, but many, perhaps most, do not. I've had a recent experience of it. My mother has been in a public hospital in Barcelona for more than one month, and she is being treated all day by caring nurses and doctors whose public sector ethos, kindness and generosity goes beyond anything I had dreamed of and Niskanen had ever imagined. Please, more budget for them.

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