Preferences for Public Provision
Police protection and justice could, in principle, be provided by private
markets. Security guards, private detectives, and bodyguards all provide
police-like protection. Privately hired arbitrators, “hired guns,” and
vigilantes of the Old West represent private ways of obtaining “justice.”
Yet the members of society may believe that a public police force is
preferable to a private one and that public justice is preferable to justice
for hire.
The question of the boundary between public and private provision is
fairly straightforward with regard to justice, but can be more controversial
in other arenas. For example, healthcare in Canada is publicly financed,
but there is ongoing debate about the extent to which a greater role
should be played by the private sector. A few decades ago in Canada, the
United States, and Western Europe, many government-owned firms that
had provided goods and services for many years were “privatized.” For
example, various governments decided there was little rationale for
public provision of services such as air and rail travel (Air Canada and
Canadian National Railways) and goods such as retail gasoline (Petro-
Canada).
Governments of mixed economies around the world make different
decisions about the extent of public provision, based partly on efficiency
arguments and also on other less tangible social factors. Many northern