Privatization's impact on private productivity: the case of Brazilian iron ore
AbstractA major motivation for the wave of privatizations of state-owned enterprises (SOEs) in the last twenty years was a belief that privatization would increase economic efficiency. There are now many studies showing most privatizations achieved this goal. Our theme is that the productivity gains from privatization are much more general and widespread than has typically been recognized in this literature. In assessing the productivity gains from privatization, the literature has only examined the productivity gains accruing at the privatized SOEs. But privatization may have significant impact on the private producers that often exist side-by-side with SOEs. In this paper we show that this was indeed the case when Brazil privatized its SOEs in the iron ore industry. That is, after their privatization, the iron ore SOEs dramatically increased their labor productivity, but so did the private iron ore companies in the industry.
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Bibliographic InfoPaper provided by Federal Reserve Bank of Minneapolis in its series Staff Report with number 337.
Date of creation: 2004
Date of revision:
Publication status: Published in Review of Economic Dynamics
Other versions of this item:
- James A. Schmitz, Jr. & Arilton Teixeira, 2008. "Privatization's Impact on Private Productivity: The Case of Brazilian Iron Ore," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 11(4), pages 745-760, October.
- L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
- L70 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - General
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