Prices as feedback for public services

Updated: 2026.04.22 2H ago 1 sources
When government buys services for a captive population (students, patients, diverted youth), the lack of consumer choice means there is no market price signal to reveal quality or demand. That absence shifts provider incentives toward regulatory compliance and cost‑reduction instead of improving outcomes, producing persistent program failures despite generous funding. — Reintroducing price‑oriented feedback (or proxy signals that mimic it) into public procurement could align incentives, improve outcomes, and reduce waste across social programs and criminal‑justice diversion.

Sources

Price: What is it Good For?
Rob Kurzban 2026.04.22 100% relevant
The article’s Philadelphia juvenile‑diversion example: city funds a provider but beneficiaries cannot 'vote with dollars,' so providers optimize compliance and cost control rather than effectiveness.
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