Information and communications technology (ICT) is radically changing productive processes in both the private and public sectors. Institutions that are more efficient eliminate production diseconomies and enable a more functional market. Specifically, institutions can multiply the incentives for human capital accumulation both by reducing the endogenous uncertainty in social-economic relations and by providing additional input to human capital generation itself (think of schools, universities, and research institutes). Mainstream economic thinking generally accepts the argument according to which the transaction and information costs that are inherent to policy-making are largely greater than those incurred by the private sector (Dixit, 1996). If this is true, then public sector intervention is denied the possibility of achieving more efficient results than those obtained by the private sector (Holstrom & Milgrom,1991). Yet, ICT is radically transforming the way government entities perform their activities, which makes a timely debate on public sector information, in all its forms, all the more crucial. Public administrations are following the example of the private sector by harnessing the efficiency-boosting potential of these new technologies. This development goes under the name of “electronic government” (e-government) and it encompasses both the internal and external applications of ICT in the public sector. The importance of this development is increasingly evident in many countries of the world. Experiments are underway in Europe, at all levels of public administration (local, regional, national, and supranational), to improve the efficiency of public services and to increase interactions with the external world. ICT not only facilitates the inner workings of administrative machinery, it also eases communication between different branches of the administration and its interaction with citizens and businesses. This latter aspect is one of the main advantages of e-government, as it brings public sector entities, businesses, and citizens closer together, as well as improving the standard of public services. In September 2003, the European Commission issued a Communication on “The Role of E-government for Europe’s Future”: it stated that e-government “is an enabler to realise a better and more efficient public administration. It improves the development and implementation of public policies and helps the public sector to cope with the conflicting demands of delivering more and better services with fewer resources” (p. 7).
The Status of e-Administration in Hungary – Are We on the Right Track?
