Inter-sector efficiency determines whether a government activity yields greater net societal benefits than if the activity were left to the private sector. Which option best captures this concept?

Inter-sector efficiency determines whether a government activity yields greater net societal benefits than if the activity were left to the private sector. Which option best captures this concept?

• A. It minimizes government spending.
• B. It measures staff training effectiveness.
• C. It determines whether public activity yields greater net benefits than private sector.
• D. It focuses only on operational efficiency.

Answer: (C)

Inter-sector efficiency is about weighing the overall impact on society when a service or program is provided by the government versus by the private sector. It asks whether public provision yields greater net benefits to society than leaving it to private providers, after considering costs, benefits, and any external effects. The option that best captures this idea says it determines whether public activity yields greater net benefits than the private sector. That aligns with the notion of comparing welfare outcomes across sectors, not just focusing on internal metrics. Reducing government spending (a) focuses on cost alone, not on whether the net societal benefits are higher. Measuring staff training effectiveness (b) targets internal capability and efficiency, not cross-sector welfare. Focusing only on operational efficiency (d) ignores the crucial comparison of public versus private value to society.

Inter-sector efficiency is about weighing the overall impact on society when a service or program is provided by the government versus by the private sector. It asks whether public provision yields greater net benefits to society than leaving it to private providers, after considering costs, benefits, and any external effects.

The option that best captures this idea says it determines whether public activity yields greater net benefits than the private sector. That aligns with the notion of comparing welfare outcomes across sectors, not just focusing on internal metrics.

Reducing government spending (a) focuses on cost alone, not on whether the net societal benefits are higher. Measuring staff training effectiveness (b) targets internal capability and efficiency, not cross-sector welfare. Focusing only on operational efficiency (d) ignores the crucial comparison of public versus private value to society.