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Homework answers / question archive / Some goods and services are provided directly by the government, while others are funded publicly but provided privately
Some goods and services are provided directly by the government, while others are funded publicly but provided privately. What is the difference between these two mechanisms of public financing? Why do you think the same government would use one approach sometimes and the other approach at other times?
Ans- When the Government of any country directly or itself produces the goods or service the direct public provision occurs in that case. For example- police forces and military.
Whereas on the other hand public financing of private provision of goods or services occur when the government wishes to increase the provision of goods but do not want to directly enter into production. For example- public private partnership (PPP). When government hire private company to build or repair roads is an example of this case.
Public funding for private provision is appealing related to director public provision whenever the private market can produce the goods or services more efficiently than the government. It is when the market is competitive. In case when there is no existing market for goods produced by government there may be stronger case for direct provision.
