Chapter 2: For-Profit, State and Non-Profit: How to Cut the Pie Among the Three Sectors
2. For-proﬁt, state, and non-proﬁt: how to cut the pie among the three sectors1 Avner Ben-Ner INTRODUCTION What is the best way to deliver various goods and services in the advanced complex economy? What is the appropriate division of labour among the state, the private for-proﬁt, and the non-proﬁt sectors? This chapter explores these questions relative to the well-being of consumers, and oﬀers a set of broad answers grounded in the analysis of the relations between diﬀerent types of organization and their consumers, and the internal organization of these types of organization. Around the turn of the twenty-ﬁrst century, economic activity was divided among the for-proﬁt, state and non-proﬁt sectors in a few large advanced economies in the following ways: for-proﬁt ﬁrms employed the vast majority of workers in the economy, from almost two-thirds in France to about three-quarters in Germany, the UK and the USA; government organizations (enterprises and agencies) at various levels employed as little as 15 per cent of workers in the USA to as much as almost one-third in France; and non-proﬁt organizations employed as little as 5 per cent of workers in France and Germany to as many as 9 per cent in the USA. The shares of the three sectors changed during the previous two decades, with the state shrinking and the other two sectors growing.2 The experience of developed market economies such as France, Germany, the UK and the USA illustrates that...
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