ABSTRACT
One of the more recent changes in welfare services following in the wake of contracting-out has been the introduction of internal markets. These may be regarded as an extension of the market testing approach discussed previously in the section on contracting-out. They are sometimes referred to as quasi-markets (Le Grand and Bartlett, 1993) because they mimic the operation of private markets, with various mediating agents such as professionals acting on behalf of the ultimate consumer. They are an increasing component in welfare systems in many countries including Sweden and New Zealand but it is only in the UK that they have been introduced on a compulsory basis (Walsh, 1995).
