Motivation, Agency, and Public Policy: Of Knights and Knaves, Pawns and Queens

By Julian Le Grand | Go to book overview

6 Agency and Public Finance

If I'd known I was going to live this long, I'd have taken better care of myself.

(Eubie Blake, on reaching the age of 100; Observer, 13 February 1983)

Old age is the most unexpected of all things that happen to a man.

(Leon Trotsky, Diary, 8 May 1935)

I now turn to a different set of questions, but ones that also bring up agency issues in the context of the public sector. They concern not the delivery of public services but what we might think of as the cash or financial side of the public sector: that is, that part which is concerned with financing the provision of services and of cash benefits designed to support or to supplement people's incomes or capital assets. Again the arguments vary with the context, and I shall concentrate on some particular cases. Specifically, I shall address the question of savings, old age pensions, and the finance of long-term care.

With the exception of those who are lucky to acquire substantial wealth through inheritance or some other windfall, everyone will need to engage in some form of savings or capital accumulation to cover their future needs. In particular, all of us will need to have some form of pension or other form of income to be able to support ourselves when we are too old to work; some of us may become mentally or physically disabled and need more intensive forms of personal care. Others may require capital at earlier stages in their lives, for instance in order to start a business or to acquire a home.

We saw above that there was a prima facie case for users of public services to be queens not pawns, but that nonetheless some restrictions on user power had to be accepted in case users demanded too much of, or the wrong kind of, the service concerned. The situation is similar with respect to savings decisions in that there is a presumption that individuals should be queens not pawns, but that again there is a case for some limited intervention from outside. One difference, though, lies in the basis for that case: the concern here is not that too much of the activity concerned will be undertaken but too little.

-85-

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Motivation, Agency, and Public Policy: Of Knights and Knaves, Pawns and Queens
Table of contents

Table of contents

  • Motivation, Agency, and Public Policy iii
  • Preface ix
  • Contents xiii
  • List of Figures xiv
  • 1: Introduction 1
  • Part I Theory: of Knights and Knaves 21
  • 2: Knights and Knaves in the Public Sector 23
  • 3: Motivation and the Policy Context 39
  • 4: A Theory of Public Service Motivation 51
  • Part II Theory: of Pawns and Queens 71
  • 5: Agency and Public Services 73
  • 6: Agency and Public Finance 85
  • Part III Policy 93
  • 7: Health Care 95
  • 8: School Education 107
  • 9: A Demogrant 120
  • 10: Partnership Savings 137
  • 11: Hypothecation 147
  • Epilogue : Doux Commerce Publique 163
  • Index 183
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