Does a change in the ownership of firms, from public to private, make a difference?
AbstractThe economic impact of privatisation is hard to assess. This paper extends the analysis of Florio (2004) in four directions. It argues that a welfare assessment of privatisation must include an evaluation of the performance of public enterprises in light of their originally broad set of objectives including, for example, the promotion of employment. It highlights the importance of financial pressure, independently of privatisation, in improving the performance of public firms. It goes on to discuss the potential role of supranational institutions in bringing about this pressure, and identifies the relevance of the 1976 IMF intervention in the UK. International empirical evidence is then presented in support of Florio's argument that privatisation was not decisive in improving labour productivity. Finally, the paper argues that institutional differences across countries make cross-country analyses of privatisation problematic.
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Bibliographic InfoPaper provided by Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano in its series Departmental Working Papers with number 2006-03.
Date of creation: 01 Feb 2006
Date of revision:
Privatization; Great Britain; Public Ownership;
Find related papers by JEL classification:
- L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
- L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-03-11 (All new papers)
- NEP-BEC-2006-03-11 (Business Economics)
- NEP-PBE-2006-03-11 (Public Economics)
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