# Public finance question | Business & Finance homework help

This discussion question requires you to do a little math. First, however, you should read the article by Shleifer entitled “State versus Private Ownership.” Shleifer argues that most often the private provision (ownership) of public services in most cases is more efficient and of higher quality for a number of reasons.

In a small way, I would like you to test his assertions using two local governments in Broward County: the Cities of Weston and Coconut Creek. You may or may not know that Weston prides itself on having few public employees on its payroll. In fact, it contracts for most of the goods and services provided to its residents. In other words, it is a contract city.

Coconut Creek is a typical city with most services provided through its own public employee workforce. The cities are about the same size. Below I will provide you with key data from which you will need to compute a few items for comparison. Here is a hint. In the Anderson book, he writes about ways to measure the public sector. See page 35 specifically (adjusting for population growth), although in this discussion we are not interested in growth but in comparative measures between the two cities, primarily comparing the cost of providing police and parks services.

Using the data below, tell me

1. 1.Who spends more on police services?

2. 2.Who spends more on parks services?

Now for the discussion part.

3. 3.Do these figures tell you if the contract city (Weston) is more efficient or less efficient than the city with 100% publicly provided services (Coconut Creek)?

4. 4.Is there another useful measure here that might shed light on the comparative wealth of each city?

Here are the data.

Weston

Population: 65,237

Tax base: \$6,509,074,724

Police budget: \$10,095,100

Parks budget: \$5,701,700

Current millage rate: 2.0

Coconut Creek

Population: 53,313

Tax base: \$2,650,883,782

Police budget: \$16,016,840

Parks budget: \$3,800,280

Current millage rate: 6.38

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