Consumers are indifferent about the provenance of the goods and services they consume. Given their information, income, and preferences, they choose from the lowest price source--with price defined to include transaction and deadweight costs. There are many supply sources: families, charitable...

The competition that permeates the public sector acts as a force to discipline public sector actors. But it also serves to build links between the volume of goods and services supplied by public bodies and the prices that citizens must pay for them. Globalization, by permitting a greater...