Can you give an example of what would happen if there was no competition in the market?
Most public services provided by governments are public sector monopolies. A majority of these services do not generate revenues. The private sector will not offer these services. Where they do, they are either part of a brand-building exercise or are financed by corporate social responsibility budgets. The public perceives most public services to be inefficient with poor service quality.
Checks and balances are critical to prevent a complete breakdown of monopoly public services. In democratic societies, opposition political parties, public interest groups, and the media as essential watchdogs that help keep the service delivery mechanisms alert and responsive to their responsibilities. Wherever these watchdog institutions are vigilant, public service quality operates and continues to deliver services at optimal levels.
The service quality is poor in regions with no social or political challenge to government public service delivery bodies. Communist Soviet Union was an example of monopolistic state control over the entire gamut of public service delivery bodies. The continuance of such a state was unacceptable to the people. The state imploded from within, leading to the break up of the Soviet Union. Indeed, what followed also did not provide an optimal service delivery model. That is more a political than a question of business.
Competition and business excellence are critical pillars of quality service delivery. Monopoly services will need to innovate and develop appropriate models in which the public continues to enjoy quality services.
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