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The innovation deficit in public services : the curious problem of too much efficiency and not enough waste and failure

Potts, Jason D. (2009) The innovation deficit in public services : the curious problem of too much efficiency and not enough waste and failure. Innovation: Management, Policy & Practice: the international journal for innovation research, commercialization, policy analysis, 11(1), pp. 34-43.

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Abstract

It has long been recognised that government and public sector services suffer an innovation deficit compared to private or market-based services. This paper argues that this can be explained as an unintended consequence of the concerted public sector drive toward the elimination of waste through efficiency, accountability and transparency. Yet in an evolving economy this can be a false efficiency, as it also eliminates the 'good waste' that is a necessary cost of experimentation. This results in a systematic trade0off in the public sector between the static efficiency of minimizing the misuse of public resources and the dynamic efficiency of experimentation. this is inherently biased against risk and uncertainty and therein, explains why governments find service innovation so difficult. In the drive to eliminate static inefficiencies, many political systems have susequently overshot and stifled policy innovation. I propose the 'Red Queen' solution of adaptive economic policy.

Impact and interest:

18 citations in Scopus
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14 citations in Web of Science®

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ID Code: 29920
Item Type: Journal Article
Keywords: public sector economics, economic evolution, innovation, innovation policy
ISSN: 1447-9338
Subjects: Australian and New Zealand Standard Research Classification > ECONOMICS (140000) > APPLIED ECONOMICS (140200) > Public Economics- Public Choice (140213)
Australian and New Zealand Standard Research Classification > ECONOMICS (140000) > APPLIED ECONOMICS (140200) > Public Economics- Publically Provided Goods (140214)
Divisions: Current > Research Centres > ARC Centre of Excellence for Creative Industries and Innovation
Current > QUT Faculties and Divisions > Creative Industries Faculty
Copyright Owner: Copyright 2009 eContent Management Pty Ltd.
Deposited On: 22 Jan 2010 09:21
Last Modified: 01 Mar 2012 00:05

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