Private Operation with Public Supervision: Evidence of Hybrid Modes of Governance in Prisons

37 Pages Posted: 30 Sep 2007 Last revised: 7 Sep 2013

See all articles by Sandro Cabral

Sandro Cabral

Insper Institute of Education and Research; Federal University of Bahia (UFBA)

Sérgio G. Lazzarini

Insper Institute of Education and Research

Paulo F. Azevedo

Getulio Vargas Foundation (FGV)

Date Written: January 1, 2010

Abstract

Received theories suggest a possible cost-quality tradeoff when private outsourcing arrangements are used in public services. Using data from Brazilian prisons, our study provides evidence that contradicts this prediction: the prisons not only run at a lower cost, but also show similar or improved performance on a range of quality indicators. The attenuation of the cost-quality dilemma in our context is due to the hybrid management, which allocates control rights to a state-appointed public supervisor. We also discuss conditions in which the public supervisor may refrain from colluding with the private agent, therefore guaranteeing an effective monitoring of service quality.

Keywords: Hybrid governance, Public supervision, Prisons, Implicit contracts

JEL Classification: L33

Suggested Citation

Cabral, Sandro and Lazzarini, Sérgio Giovanetti and Azevedo, Paulo F., Private Operation with Public Supervision: Evidence of Hybrid Modes of Governance in Prisons (January 1, 2010). Public Choice, Vol. 145, No. 1-2, 2010. Available at SSRN: https://ssrn.com/abstract=1017801 or http://dx.doi.org/10.2139/ssrn.1017801

Sandro Cabral (Contact Author)

Insper Institute of Education and Research ( email )

R Quata 300
Sao Paulo, 04542-030
Brazil

Federal University of Bahia (UFBA) ( email )

Av. Reitor Miguel Calmon, s/n
Vale do Canela
Salvador, Bahia
Brazil

Sérgio Giovanetti Lazzarini

Insper Institute of Education and Research ( email )

R Quata 300
Sao Paulo, 04542-030
Brazil
55-11-45042387 (Phone)

HOME PAGE: http://www.sergiolazzarini.insper.edu.br/indexelazza.html

Paulo F. Azevedo

Getulio Vargas Foundation (FGV) ( email )

R Itapeva, 474 11º. andar
São Paulo, São Paulo 01332-000
Brazil

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