> Conventional wisdom is that the private sector is just much more efficient than the state can ever be, but I have never been able to find evidence-based studies for or against this.

This is hard to measure empirically because of selection bias - you can only study things which have already been privatized, and the first things to be privatized are the things you think will privatize successfully. For example, there are quite a few countries that have successfully privatized their telephone networks. But that doesn't mean you could privatize the police or military with the same success!

And because you asked for evidence-based citations, here you go: http://www.quora.com/Is-there-empirical-evidence-to-support-...