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Public vs. private sector : an examination of neo-liberal ideology

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Khan, Iram

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Abstract

The paper reviews the theoretical underpinnings of the debate on the superiority of the public or private sector, and supports theoretical perspectives with help from empirical literature on the subject. The theoretical part covers issues relating to public choice, property rights and principal-agents relationship, while the empirical evidence includes review of literature on macroeconomic, microeconomic and welfare impacts of privatization. The paper finds that despite numerous studies and unending discussions, the debate on the superiority of the public or private sector has remained inconclusive and is likely to remain so in the future. Notwithstanding the practical difficulties of making this assessment, the paper concludes that this debate is more ideological rather than empirical, since it is not possible to determine the superiority of one over the other through case studies, which can only be selective in nature.

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File URL: http://mpra.ub.uni-muenchen.de/13443/
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 13443.

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Date of creation: 2006
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Handle: RePEc:pra:mprapa:13443

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Related research
Keywords: New Public Management;

Find related papers by JEL classification:
B00 - Schools of Economic Thought and Methodology - - General - - - History of Economic Thought, Methodology, and Heterodox Approaches
A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists

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  1. Clarke, George R. G. & Menard, Claude & Maria Zuluaga, Ana, 2002. "Measuring the Welfare Effects of Reform: Urban Water Supply in Guinea," World Development, Elsevier, vol. 30(9), pages 1517-1537, September. [Downloadable!] (restricted)
  2. Rama, Martin & MacIsaac, Donna, 1999. "Earnings and Welfare after Downsizing: Central Bank Employees in Ecuador," World Bank Economic Review, Oxford University Press, vol. 13(1), pages 89-116, January.
  3. Assaad, Ragui, 1999. "Matching Severance Payments with Worker Losses in the Egyptian Public Sector," World Bank Economic Review, Oxford University Press, vol. 13(1), pages 117-53, January.
  4. Tansel , A., 1997. "Workers Displaced Due to Privatization in Turkey," Papers 9719, Economic Research Forum.
  5. Majumdar, Sumit K, 1998. " Assessing Comparative Efficiency of the State-Owned Mixed and Private Sectors in Indian Industry," Public Choice, Springer, vol. 96(1-2), pages 1-24, July. [Downloadable!] (restricted)
  6. Eckel, Catherine & Eckel, Doug & Singal, Vijay, 1997. "Privatization and efficiency: Industry effects of the sale of British Airways," Journal of Financial Economics, Elsevier, vol. 43(2), pages 275-298, February. [Downloadable!] (restricted)
  7. Chisari, Omar & Estache, Antonio & Romero, Carlos, 1999. "Winners and Losers from the Privatization and Regulation of Utilities: Lessons from a General Equilibrium Model of Argentina," World Bank Economic Review, Oxford University Press, vol. 13(2), pages 357-78, May.
  8. Haltiwanger, John & Singh, Manisha, 1999. "Cross-Country Evidence on Public Sector Retrenchment," World Bank Economic Review, Oxford University Press, vol. 13(1), pages 23-66, January.
  9. Olivier Boylaud & Giuseppe Nicoletti, 2000. "Regulation, Market Structure and Performance in Telecommunications," OECD Economics Department Working Papers 237, OECD, Economics Department. [Downloadable!]
  10. Cook, Paul & Uchida, Yuichiro, 2001. "Privatisation and Economic Growth in Developing Countries," Centre on Regulation and Competition (CRC) Working papers 30634, University of Manchester, Institute for Development Policy and Management (IDPM). [Downloadable!]
  11. Pollitt, M. & Smith, A.S.J., 2001. "The Restructuring and Privatisation of British Rail: Was it really that bad?," Cambridge Working Papers in Economics 0118, Faculty of Economics, University of Cambridge. [Downloadable!]
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