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Public entrepreneurship and the economics of reform

Published online by Cambridge University Press:  01 August 2007

JAN SCHNELLENBACH
JAN SCHNELLENBACH*
Affiliation:
Ruprecht-Karls-University, Heidelberg, Alfred-Weber Institute for Economics. Email: jan.schnellenbach@awi-uni-heidelberg.de.
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Abstract:

Public entrepreneurship is commonly understood as the outcome of the activities of a Schumpeterian political innovator. However, empirical research suggests that changes to a more efficient economic policy, even if it is known and technically easy to implement, are usually delayed. This is difficult to reconcile with Schumpeterian notions of public entrepreneurship. In this paper, it is argued that the attempt to transfer a Schumpeterian approach to the public sector is fundamentally flawed. Institutional checks and balances that characterize most modern liberal democracies make the strategy of bold leadership an unlikely choice for an incumbent. If change occurs, it occurs normally as a response to the fact that the status quo has become untenable. From a normative point of view, it is argued that if public entrepreneurship nevertheless occurs, it will often be associated with unwanted consequences. A dismantling of formal institutional checks and balances is therefore not reasonable.

Type
Research Article
Information
Journal of Institutional Economics , Volume 3 , Issue 2 , August 2007 , pp. 183 - 202
Copyright
Copyright © The JOIE Foundation 2007

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