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Fiscal austerity and public servant quality
Author(s) -
Haque NU,
Montiel P,
Sheppard S
Publication year - 2000
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.2000.tb00031.x
Subject(s) - public sector , austerity , private sector , productivity , economics , government (linguistics) , quality (philosophy) , labour economics , constraint (computer aided design) , public economics , macroeconomics , economic growth , economy , political science , mechanical engineering , linguistics , engineering , philosophy , epistemology , politics , law
In this article we use a simple model to analyze the forces that determine the size of the public sector and the quality of workers employed in that sector. Workers are heterogeneous, and the public sector chooses an employment strategy which maximizes a utility function U(s, Y) that depends on the share of the labor force employed in public service s and private sector output Y. The government is fully informed about worker productivity. We characterize the behavior of the public sector, and explore the efficiency and employment consequences of imposing fiscal constraint on the government.