In this paper we disentangle the sources of public sector inefficiency using 1982-1995 panel data on manufacturing firms in Indonesia. We consider two leading hypotheses: (1) public sector enterprises are inefficient due to monitoring problems and (2) public sector enterprises are inefficient...

In this paper we disentangle the sources of public sector inefficiency using 1982-1995 panel data on manufacturing firms in Indonesia. We consider two leading hypotheses: (1) public sector enterprises are inefficient due to monitoring problems and (2) public sector enterprises are inefficient...

Is public sector inefficiency due primarily to agency-type problems (ownership) or to the environment in which public enterprises operate (as measured by soft budget constraints or barriers to competition)? Both. Bartel and Harrison compare the performance of public and private sector...