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  • Published: 1 Sep 2017
  • DOI: 10.4324/9781138201521-HET17-1


  • Abstract
  • The co-evolution of private and public sectors 1700–1914
  • Public sector vs. non-market governance
  • Public and private goods: the core economic concept of the private–public dichotomy
  • The complementarity of private and public sector: political theory and economics
  • Determinants of modern public budgeting: collective choice and individual values
  • References

Private vs. Public Sector

University of Graz, Austria


Private and public sectors are often considered in a dichotomous way. However, it is important to note that the private and public sectors of modern societies progressed in a process of asymmetric and sometimes discontinuous co-evolution. Taking as a point of reference a pre-modern state of affairs where the private–public dichotomy is not yet developed, key issues and concepts relevant for this dichotomy are discussed. They are indispensable for LIST1 distinguishing the modern public sector from other forms of non-market governance and LIST 2 considering the dynamism of individualist private market-mediated economy and the evolution of a distinctively modern public sector as two sides of the same coin. END OF LISTIn that context, collective choice (related to the co-existence of individual values and ‘democratic’ procedures) and the distinction between public and private goods are of pivotal importance.