XPost: soc.culture.baltics, soc.culture.czecho-slovak, soc.culture.russian   
   XPost: soc.culture.nordic, soc.culture.baltics   
   From: anton.usenet@gmail.com   
      
   [Followup-To: s.c.n and r.a.s.m]   
      
   David Friedman kirjoitti:   
   > In article ,   
   >  Anton  wrote:   
      
   >> Do you mean by "private provision" that parents of students can choose   
   >> themselves which company will do the cleaning of the school, or that the   
   >> indivudual train passanger can choose over railway company X and railway   
   >> company Z to travel from destination A to B?   
      
   >> Perhaps you meant that many privately owned schools offer the same   
   >> service and allow the customers to choose the provider that offers the   
   >> best quality/terms?   
      
   > By private provision of schooling, I mean that schools are ordinary   
   > private firms, and parents choose which one to pay to educate their   
   > children   
      
   Ok. I understood it correctly then. The problem is, that in certain   
   rural areas there is a chance for local monopolies to occur, and thus   
   there will be no benefits of market competition at all. On the contrary   
   unless education is subsidized for those who are less off, there will be   
   disadvantages of this model (other than economical). Also, when the   
   education is subsidized, the argument that private ownership cuts   
   "costs" of "socialism" does not hold.   
      
   >, just as they now choose what private restaurant or private   
   > grocery store to buy food from. That could occur either with a fully   
   > private system, such as England c. 1830, or with a voucher system, where   
   > some or all of the money was provided by the state to the parents.   
      
   This way of subsidizing creates temptations for the provider to further   
   increase the asking price for the service than it normally would, when   
   the government by this subsidy is artificially improving the bying power   
   of the buyer. So tax payers might basically end up from financing the   
   upkeep of the service to finance increased dividends to those who own   
   the stock of the service provider.   
      
   > By private provision of railway services, I mean that railroads are   
   > private firms selling their services to anyone who want to buy them--the   
   > way in which railroads in fact developed in the U.S. and (I think) the   
   > U.K.   
      
   The whole structure of this business even technically has such   
   characteristics that in many cases there will be a privately owned   
   monopoly. In many industries that have traditionally had public   
   ownership I don't see much of an advantage of private ownership. You are   
   virtually having many of the same disadvantages as in a publicly owned   
   company. Perhaps competing of capital from invstors is the benefit that   
   can improve the efficiency, but the monopolistic market situation   
   results in possibly higher prices for the customers, so it is good if   
   you own their stock, yes, but bad if you have no other altrnative than   
   to use their service.   
      
   --   
   Anton   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)