Article at a glance:
The costly retirement of aging populations in the United States, Europe, and Japan will soon create a new urgency to get the most out of every government dollar. Governments typically respond to such fiscal pressures by reducing the level or growth rate of benefits, raising taxes, or cutting public services for the rest of the population. But they have another, often-overlooked option: enhancing public-sector productivity could take the sting out of the hard fiscal choices our societies will need to make.
The take-away
A handful of public-sector organizations—including schools, public-welfare agencies, health care systems, postal and transit systems, and militaries—have already raised their performance substantially, providing valuable lessons for others.
This article includes the following exhibits:
- Exhibit 1: Government expenditure as % of GDP
- Exhibit 2: Potential gains from increasing public-sector productivity for selected countries
- Exhibit 3: Comparison between productivity growth rates of private and public sectors for selected countries