ABSTRACT
The foundational idea of the Ostroms’ institutionalism is simple but powerful in its implications: analysis of the public sector should be no different in its basic assumptions from studies of the market-oriented private sector. The focus of analysis is in both cases the individuals and their actions in various institutional arrangements. Methods used to understand complex economic industries involving large and small profit-seeking enterprises competing within more or less efficient and competitive markets, should be expected to be equally functional for the study of equally complex public structures. The large number of public enterprises operating in a modern society (at the national level or at local, metropolitan levels) could be studied using tools transferable from one domain to another. Although the standard framework needs special adjustments in order to get adapted to a phenomenon that is in the end different from the market-based phenomena, the analysis of public governance issues requires an approach that is fundamentally similar to the analysis of private industries (Ostrom and Ostrom 1965, 1977; E. Ostrom 1972, 1983, 1996).
