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Privatization and Employment: A Study of the Jute Industry in Bangladesh

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  • Bhaskar, V
  • Khan, Mushtaq

Abstract

This paper analyzes the effect of privatization upon employment in the Bangladeshi jute textile industry. Privatization was partia and the selection of mills which were privatized was not based on current economic performance. This provides us with a panel data set which permits reliable estimates of the effects of ownership on employment and output. Privatization has reduced employment of all categories of permanent workers significantly, but the extent of employment reduction has been substantially greater among clerical workers and managers as compared to manual workers. This implies that public sector excess employment benefited white-collar workers, who were both better off and better educated, and suggests that public sector behaviour was clientelist rather than welfarist.
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Suggested Citation

  • Bhaskar, V & Khan, Mushtaq, 1995. "Privatization and Employment: A Study of the Jute Industry in Bangladesh," American Economic Review, American Economic Association, vol. 85(1), pages 267-273, March.
  • Handle: RePEc:aea:aecrev:v:85:y:1995:i:1:p:267-73
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    Cited by:

    1. Chong, Alberto & Lopez-de-Silanes, Florencio, 2002. "Privatization and labor force restructuring around the world," Policy Research Working Paper Series 2884, The World Bank.
    2. J. DavidBrown & JohnS. Earle & Álmos Telegdy, 2010. "Employment and Wage Effects of Privatisation: Evidence from Hungary, Romania, Russia and Ukraine," Economic Journal, Royal Economic Society, vol. 120(545), pages 683-708, June.
    3. Huizinga, Harry & Nielsen, Soren Bo, 2001. "Privatization, public investment, and capital income taxation," Journal of Public Economics, Elsevier, vol. 82(3), pages 399-414, December.
    4. David Parker & Colin Kirkpatrick, 2005. "Privatisation in Developing Countries: A Review of the Evidence and the Policy Lessons," Journal of Development Studies, Taylor & Francis Journals, vol. 41(4), pages 513-541.
    5. Durevall, Dick & Munshi, Farzana, 2006. "Trade Liberalization and Wage Inequality: Empirical Evidence from Bangladesh," Working Papers in Economics 205, University of Gothenburg, Department of Economics.
    6. David McKenzie & Dilip Mookherjee, 2003. "The Distributive Impact of Privatization in Latin America: Evidence from Four Countries," ECONOMIA JOURNAL, THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION - LACEA, vol. 0(Spring 20), pages 161-234, January.
    7. Liu, Yi & Li, Xue & Lahiri, Sajal, 2016. "Determinants of privatization in China: The role of the presence of foreign firms," China Economic Review, Elsevier, vol. 41(C), pages 196-221.
    8. Paulo Bastos & Natália Pimenta Monteiro & Odd Rune Straume, 2012. "Privatization and corporate restructuring," NIPE Working Papers 10/2012, NIPE - Universidade do Minho.
    9. Virgilio Galdo & Alberto Chong, 2006. "On Foreign Participation and Hiring Patterns After Privatization," Research Department Publications 4441, Inter-American Development Bank, Research Department.
    10. Ádám Szentpéteri & Álmos Telegdy, 2010. "Political Selection Of Firms Into Privatization Programs. Evidence From Romanian Comprehensive Data," Economics and Politics, Wiley Blackwell, vol. 22(3), pages 298-328, November.
    11. Kaushik Basu, 2003. "Globalization and the Politics of International Finance: The Stiglitz Verdict," Journal of Economic Literature, American Economic Association, vol. 41(3), pages 885-899, September.
    12. Khan, Iram, 2006. "Public vs. private sector : an examination of neo-liberal ideology," MPRA Paper 13443, University Library of Munich, Germany.
    13. Esfahani, Hadi Salehi, 2000. "Institutions and government controls," Journal of Development Economics, Elsevier, vol. 63(2), pages 197-229, December.
    14. John S. Earle, 2014. "Impact of privatization on employment and earnings," IZA World of Labor, Institute for the Study of Labor (IZA), pages 1-93, October.
    15. Virgilio Galdo & Alberto Chong, 2006. "Sobre la participación extranjera y los patrones de contratación después de la privatización," Research Department Publications 4442, Inter-American Development Bank, Research Department.
    16. Yin-Fang Zhang & David Parker & Colin Kirkpatrick, 2008. "Electricity sector reform in developing countries: an econometric assessment of the effects of privatization, competition and regulation," Journal of Regulatory Economics, Springer, vol. 33(2), pages 159-178, April.
    17. Villalonga, Belen, 2000. "Privatization and efficiency: differentiating ownership effects from political, organizational, and dynamic effects," Journal of Economic Behavior & Organization, Elsevier, vol. 42(1), pages 43-74, May.
    18. World Bank, 2013. "Bangladesh - Poverty Assessment : Assessing a Decade of Progress in Reducing Poverty, 2000-2010," World Bank Other Operational Studies 16622, The World Bank.
    19. Gene Chang & Josef Brada, 2011. "A Model of the Macroeconomic Effects of Privatization on Employment in Transition and Developing Countries with an Application to China," Transition Studies Review, Springer;Central Eastern European University Network (CEEUN), vol. 18(2), pages 310-327, December.
    20. Alberto Chong & Florencio Lopez-de-Silanes, 2003. "La privatización y la reestructuración de la fuerza laboral en todo el mundo," Research Department Publications 4330, Inter-American Development Bank, Research Department.
    21. Okten, Cagla & Arin, K. Peren, 2006. "The Effects of Privatization on Efficiency: How Does Privatization Work?," World Development, Elsevier, vol. 34(9), pages 1537-1556, September.
    22. Mustaq H. Khan, 2003. "L'échec de l'État dans les pays en développement et les stratégies de réforme institutionnelle," Revue d’économie du développement, De Boeck Université, vol. 11(2), pages 5-48.
    23. Willner, Johan & Parker, David, 2002. "The Relative Performance of Public and Private Enterprise Under Conditions of Active and Passive Ownership," Centre on Regulation and Competition (CRC) Working papers 30591, University of Manchester, Institute for Development Policy and Management (IDPM).
    24. repec:taf:oabmxx:v:3:y:2016:i:1:p:1197088 is not listed on IDEAS

    More about this item

    JEL classification:

    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • I - Health, Education, and Welfare
    • K - Law and Economics

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