Chapter 1: Introduction

Savas defines privatization as 'the act of reducing the role of government, or increasing the role of the private sector, in an activity or in the ownership of assets.' Privatization takes both generic and specific forms: generic forms include contracting out to private or nonprofit firms and volunteer provision of services. Specific forms include food stamps, housing vouchers, and volunteer fire departments.

Savas notes the general confusion today over the meaning of the word 'public', varying from 'government ownership' to 'widespread ownership' or 'widespread access'. He notes that in this book 'public service' refers to a wide range of government activities, from trash collection to national defense.

Savas cites several pressures or reasons that are compelling privatization across the country. These reasons divide into four categories: pragmatic, where people define a need for government to improve services; ideological, where there is a desire for less government; commercial, where the private sector sees opportunities for profit by performing government services; and populist, where people justify privatization in the name of a better society.