ABSTRACT This paper surveys literature from Economics, Accounting, and Management to address theoretical issues in Public Administration regarding government provided services in order to contribute to a formal connection between principal-agent models in these disciplines and public policy administration decision-making. In particular, it addresses the question: What theoretical properties of the services themselves might guide (a) the choice of producer of the services (government or outsourcing firm/contractor), and (b) the accountability imposed for the work produced. It is found that a theoretical framework of principal-agent models that includes the decision of whether to contract out can be useful as a first step in systematically formulating the government's decision for a variety of goods/services. This provides an alterative to the identification of key decision properties “from the ground up” for each good or service the government provides.