Organizations and efficiency in public services: The case of English lighthouses revisited

Abstract

Foundational debates about public service provision originate with the study of private lighthouses in England and Wales. We provide a new empirical assessment of cost and technical efficiency of competing lighthouse organizations in the early 1800s. Those with more private control charged ships higher fees and had greater operating costs. Lights with more local representation and funding provided lights of more local use and were most cheaply maintained. Our results help explain why government promoted nonprofit organizations to run lighthouses over private operators. We provide new insights into the role of private enterprise and nonprofit organizations in public service provision.