Self‐Provision of Public Services: Its Evolution and Impact

• Published date: 01 March 2012
• Date: 01 March 2012
• Author: Shlomo Mizrahi
• DOI: http://doi.org/10.1111/j.1540-6210.2011.02505.x

Shlomo Mizrahi is associate professor

and chair of the Department of Public Policy

in the Faculty of Management, Ben-Gurion

University, Beer-Sheva, Israel. His research

interests include public policy, public sector

and New Public Management, political

behavior, the welfare state, regulation

and privatization, public choice and game

theory, collective action and interest groups,

institutional change, bargaining, and

conf‌l ict resolution.

E-mail: shlomom@bgu.ac.il

Self-Provision of Public Services: Its Evolution and Impact 285

Public Administration Review,

Vol. 72, Iss. 2, pp. 285–291. © 2011 by

The American Society for Public Administration.

DOI: 10.111/j.1540-6210.2011.02505.x.

Shlomo Mizrahi

Ben-Gurion University of the Negev, Israel

 is article establishes a framework for explaining the

ways in which citizens, as clients of public services,

attempt to deal with situations of combined market and

government failures. Under certain conditions, citizens

are driven to create self-production mechanisms that often

are extralegal or illegal. When faced with such social

initiatives, politicians often support them, either passively

or actively, by institutionalizing the new mechanisms.

 e article explains the evolution of the self-provision

model and its implications.  e analysis includes a

theoretical framework and a practical intervention

scheme.

R

ecent decades have been characterized by

signif‌i cant changes in the roles, functions, and

scope of activities of the modern state and

government agencies. In analyzing processes of change

and transformation, public administration research

tends to focus on the organizational level, where three

main sectors operate at the macro level: the public,

the private, and the third (not-for-prof‌i t) sectors.

However, when these sectors fail, as often occurs in the

provision of public goods, citizen dissatisfaction may

grow.  ere are various ways in which citizens who

are dissatisf‌i ed with the quantity or quality of services

provided by one (or all) of these sectors may attempt

to improve their outcomes and satisfy their needs. One

dominant strategy is to turn to another sector (e.g.,

the private sector) when one sector (e.g., the public

sector) fails to provide services, thus adopting an exit

strategy. Another strategy is the

voice option, whereby citizens

demand service improvement

(Hirschman 1970). However,

when citizens feel that both the

exit and voice options have been

exhausted, they attempt to f‌i nd

alternative provision methods,

which often include the self-

provision of services.

 is ar ticle suggests a theoretical framework for

explaining the conditions for the evolution of

self-provision mechanisms and justif‌i cations for their

continuation. Self-provision mechanisms are def‌i ned

here as informal methods and strategies used by indi-

viduals and groups to satisfy their immediate interests

and need for services. By choosing self-provision

strategies, individuals and groups use none of society’s

established institutional settings (i.e., the formal rules

and laws), whether these are dominated by the public,

the private, or the third sector. Rather, they attempt to

improve their outcomes through extralegal or illegal

strategies. Self-provision strategies may belong to

one of two categories: informal (or under-the-table)

payments for services and self-production of services.

Informal payments to providers of public services

change the incentive scheme, meaning that the payer

actually creates alternative production channels as

compared to the established legal mechanisms in

society.  e two categories require self-f‌i nancing and

hence may contribute to welfare state retrenchment as

well as increase social inequalities.

Examples of self-provision strategies are numerous.

We may consider the large number of informal pay-

ments in public health care systems in many democ-

racies a type of extralegal provision of gray market

health care (Gaal et al. 2006). Similar mechanisms

of informal payments, whether illegal, extralegal, or

legal, also characterize educational systems in many

democracies (Noguera 1994; Savas 2000; Swirski

1999). Internal security is another area in which

a high level of demand for

high-quality services meets

a shortage in supply, leading

to the development of ext-

ralegal, alternative initiatives

for producing services (Savas

2000). Parents forming private

schools and the creation

of other nonestablishment

services in welfare, transporta-

tion, infrastructure, and culture are further examples

of extralegal self-production strategies (Savas 2000;

Swirski 1999).

Self-Provision of Public Services: Its Evolution and Impact

[W]hen citizens feel that both

the exit and voice options have

been exhausted, they attempt

to f‌i nd alternative provision

methods, which often include

the self-provision of services.