Productivity In Public Sector

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Public sector is a part of the economy that controlled by a national, state and government. It includes the services such as police, military, public roads, public transit, primary education and healthcare. It also overlaps with the private sector in providing certain goods and services and can move from public sectors to private which called privatization. The public sector consists of an expanding ring of organization, with core government at the center, followed by agencies and public enterprises, and around this ring is gray zone consisting of publicly funded contractors and publicly owned business, which may be, but for most part are not, part of the public sector (Dube & Danescu, 2011).
Productivity in the public sector will be enhanced among others, through the rationalization of government institutions and adoption of performance-based remuneration system. To reduce overlapping functions and redundancy among government agencies, a regular review of the roles and functions of government institutions will be conducted. Agencies with
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Inputs are made up of three elements: labour, procurement of goods and services and capital consumption (Atkinson, 2005). Measurement of each of these elements may pose particular challenges in practice. For example, with regard to labour, should number of hours worked (differentiated by skill) be used instead of the number of people employed (Boyle, 2006a). The European Commission (2004), identify three important issues: how to define output, how to define aggregate output over a range of different products and how to incorporate exogenous condition such as the general health condition of a patient. A further challenge with regard to output measurement for productivity purposes is how to incorporate changes in the quality of outputs (Boyle,
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