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Article Summary

Oakerson, Ronald. 1987. "Local Public Economies: Provision, Production and Governance." Intergovernmental Perspective13:3/4, pp. 20-25.

Provision refers to collective choices that determine (1) what goods and services to provide, (2) what private activities to regulate, (3) the amount of revenue to raise, (4) the quantity and quality standards of goods, and (5) how to arrange for productions. Production refers to the more technical processes of transforming inputs into outputs.

Organizing the provision side falls into three main classes: preference revelation, fiscal equivalence, and accountability. On the other hand, organizing the production side is based on economies of scale and co-production. The options linking provision with production are self- production, coordinated production, joint production, intergovernmental contracting, private contracting, franchising, and voucher. Governance has to do with the choice of rules, which is separable from both production and provision.