Privatisation in Eastern Europe: Irreversibility and Critical Mass Effects
AbstractThis paper proposes a model to shed light on two important policy features of privatization in Central and Eastern Europe: the idea of a necessary critical mass of privatization on the one hand, and the difficulties encountered in the actual privatization process on the other, related to the government's inability to precommit to announced policies. The main ingredient of the model is the existence of a positive externality related to the size of the private sector, providing at the same time a rationale for the idea of a critical mass, but also creating a coordination problem generating multiple equilibria. This paper also shows how the distribution of free shares to the population currently advocated in Eastern Europe, may credibly make the privatizations irreversible, without completely solving the coordination problem, and even worsening in some cases, the welfare outcome.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by Universite Libre de Bruxelles - C.E.M.E. in its series Papers with number 9105.
Length: 31 pages
Date of creation: 1991
Date of revision:
Contact details of provider:
Postal: UNIVERSITE LIBRE DE BRUXELLES, CENTRE D'ECONOMIE MATHEMATIQUE ET D'ECONOMETRIE, C.P. 139, 50 AVE F.D. ROOSEVELT 1050 BRUXELLES.
Phone: (32 2) 650 30 75
Fax: (32 2) 650 44 75
Web page: http://ecares.org/
More information through EDIRC
policy making ; economic models ; investments ; government ; unemployment;
Other versions of this item:
- Roland, Gerard & Verdier, Thierry, 1994. "Privatization in Eastern Europe : Irreversibility and critical mass effects," Journal of Public Economics, Elsevier, vol. 54(2), pages 161-183, June.
- Roland, Gérard & Verdier, Thierry, 1992. "Privatization in Eastern Europe: Irreversibility and Critical Mass Effects," CEPR Discussion Papers 612, C.E.P.R. Discussion Papers.
- Roland, G. & Verdier, T., 1991. "Privatization in Eastern Europe: Irreversibility and Critical Mass Effects," DELTA Working Papers 91-21, DELTA (Ecole normale supérieure).
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
- L59 - Industrial Organization - - Regulation and Industrial Policy - - - Other
- P50 - Economic Systems - - Comparative Economic Systems - - - General
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Krichel).
If references are entirely missing, you can add them using this form.