Competition

Abstract

The conditions under which governing takes place in most developed industrialized countries have more or less been changing during the last decade. Competition is seen as an important force to increase capacities for problem-solving and for creating opportunities as part of good governance. But the emphasis on competition provokes questions. ‘Are there any limits to competition?' and it there are limits ‘What are the limits to competition like?'. In this article the objectives of competition in the public sector will be discussed and- the range of different types of competition will be classified (including models of internal market competition and non-marketed forms of competition). Based on data from empirical research projects on competition at the local level in Britain and Germany the article will provide some experiences with competition and some effects of competition (especially on costs, service quality, fragmentation, market structure, trust and empowerment). Limits of competition in the public seco will be discussed with special regard to the peculiarities of politico-administrative decision making. The way competition is politically managed is regarded as a very important cornerstone for good governance of public services.