ABSTRACT
This chapter discusses the concept of productive efficiency, focusing particularly on its place within the discipline of public administration. It elaborates the theoretical underpinnings and practical recommendations of two key approaches to improving the productive efficiency of public services. The ability of government to carry out its responsibilities as effectively as possible within the constraints of a pre-determined budget is one of the most enduring issues within the theory and practice of public policy and administration. The measurement of productive efficiency in the public sector is an issue that continues to be debated at great length by economists and statisticians. The endogenous inputs into the provision of public services typically consist of the costs and volume of the human and physical capital utilized in service production. Exogenous inputs in public services are essentially composed of the activities, capabilities and capacities of the individuals. A small number of cross-sectional studies address the relationship between performance management systems and productive efficiency.
