06 April 2007

Europe's good government

It is reasonably obvious that the biggest factor affecting the quality of a school is not the building, the management, the teaching staff, or the level of funding, but the intake. By that I do not merely mean that pupils who go in better come out better, but that a pupil entering a school with a good intake will come out better than the same pupil would entering a school with a bad intake.

While this is widely recognised for schools, I think it applies also, and possibly just as much, to other public services. The difference between a good train service and a bad train service is, to a significant degree, down to the passengers. The biggest reason for a person to prefer to drive a car, rather than take a train, is to avoid the other people who would be on the train. Indeed, the point is so strong in transport that we do not consider as "public transport" a service which does not force us into proximity with other users, i.e. taxis, which operate on exactly the same basis as any other form of public transport.

There are two kinds of public/private distinction: there is the distinction between state-provided and privately-provided services, and the distinction between publicly-consumed and privately-consumed services. They line up sufficiently to cause confusion, because publicly-consumed services are not excludable and are therefore "public goods" generally considered better provided by government. Public/private provision is a more definite yes/no question, albeit with hybrids funded by subsidy plus usage fees, while public/private consumption is a continuum - a medical operation is a private good, but control of infectious disease is somewhere in the middle.

It is with this assumption that I look at Tyler Cowen's controversial assertion that, as an effect of differences in structure, Western European governments provide public services better than the US government can. To the degree that this is true, I think the cause is more to do with the different attitudes of Europeans and Americans to public services than to different structures of government organisation. As the Economist blogger illustrates, even a straightforward benefits system will be much more effective in a public-oriented society like Denmark than in the USA.

In Britain, we seem to have the worst of both worlds: something approaching a European-sized state sector with very American public attitudes to the services it provides, and I think that more than anything explains the current state of our public services. It was not always that way -- some years ago I mentioned in a discussion of mobile phone tariffs that, where evening calls were free, some customers were using their mobile phones as baby monitors, by making a call from one handset in one room to another and leaving the call open all night. To me that was reasonable and unsurprising, but my older friend found it hard to believe that people would abuse a limited public resource that way, just because they weren't being charged. Publicly consumed services work much better with that older generation's attitudes than with those of my generation.

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