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Everyone Hates Privatization, but Why? Survey Evidence from 28 Post-Communist Countries

Author

Listed:
  • Irina Denisova

    () (CEFIR at the New Economic School)

  • Markus Eller

    () (Oesterreichische Nationalbank)

  • Timothy Frye

    () (Columbia University and the Harriman Institute)

  • Ekaterina Zhuravskaya

    () (New Economic School, Paris School of Economics, and EHESS)

Abstract

A 2006 survey of 28,000 individuals in 28 post-communist countries reveals overwhelming support for revising privatization, but also that most respondents prefer to leave firms in private hands. We test whether individuals support revising privatization primarily due to a preference for state property or due to concerns about the legitimacy of privatization. We find that a lack of human capital and privately owned assets affects the support for revising privatization primarily via a preference for state property over private property; whereas transition-related hardships influence support for revising privatization via both a preference for state property and concerns about the illegitimacy of privatization. These results suggest the value of analyses that not only link respondent traits with support for policy, but that also probe the motivations that underpin this support.

Suggested Citation

  • Irina Denisova & Markus Eller & Timothy Frye & Ekaterina Zhuravskaya, 2010. "Everyone Hates Privatization, but Why? Survey Evidence from 28 Post-Communist Countries," Working Papers w0143, Center for Economic and Financial Research (CEFIR).
  • Handle: RePEc:cfr:cefirw:w0143
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Afontsev, S., 2013. "Privatize or Not? Escaping Budget Temptation and Nirvana Fallacy," Journal of the New Economic Association, New Economic Association, vol. 20(4), pages 150-153.
    2. Del Bo, Chiara D. & Ferraris, Matteo & Florio, Massimo, 2017. "Governments in the market for corporate control: Evidence from M&A deals involving state-owned enterprises," Journal of Comparative Economics, Elsevier, vol. 45(1), pages 89-109.
    3. Polterovich, Victor, 2012. "Приватизация и рациональная структура собственности (Privatizatsiya i ratsional’naya struktura sobstvennosti)
      [Privatization and the Rational Ownership Structure]
      ," MPRA Paper 41069, University Library of Munich, Germany.
    4. Voszka, Éva, 2015. "Államosítás, privatizáció és gazdaságpolitika - a főirány széttöredezése
      [Nationalization and privatization - in the shadow of changing paradigms of economic policy]
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 717-748.
    5. Sergei Guriev & Ekaterina Zhuravskaya, 2009. "(Un)happiness in Transition," Journal of Economic Perspectives, American Economic Association, vol. 23(2), pages 143-168, Spring.
    6. Kowalski, Tadeusz, 2013. "Globalization and Transformation in Central European Countries: The Case of Poland," MPRA Paper 59306, University Library of Munich, Germany.
    7. Chao-yo Cheng & Johannes Urpelainen, 2016. "Unawareness and indifference to economic reform among the public: evidence from India’s power sector reform," Economics of Governance, Springer, vol. 17(3), pages 211-239, August.
    8. Senderski, Marcin, 2015. "Inhibited privatization: a hurdle race over vested interests," MPRA Paper 65482, University Library of Munich, Germany.
    9. Djankov, Simeon & Nikolova, Elena & Zilinsky, Jan, 2016. "The happiness gap in Eastern Europe," Journal of Comparative Economics, Elsevier, vol. 44(1), pages 108-124.
    10. Polterovich, Victor, 2016. "Институциональные Реформы И Гражданская Культура
      [Institutional Reforms and Civic Culture]
      ," MPRA Paper 71658, University Library of Munich, Germany.
    11. Polterovich, Victor, 2012. "Приватизация И Рациональная Структура Собственности. Часть 1. Приватизация: Проблема Эффективности
      [Privatization and the rational ownership structure. Part 1: privatization: the effeciency problem
      ," MPRA Paper 64371, University Library of Munich, Germany.
    12. Irina Denisova, 2016. "Institutions and the support for market reforms," IZA World of Labor, Institute for the Study of Labor (IZA), pages 258-258, May.
    13. Ivanovic, Vladan & Kufenko, Vadim & Begovic, Boris & Stanisic, Nenad & Geloso, Vincent, 2016. "Continuity under a different name: The outcome of privatisation in Serbia," Hohenheim Discussion Papers in Business, Economics and Social Sciences 10-2016, University of Hohenheim, Faculty of Business, Economics and Social Sciences.
    14. Michaël Aklin & Patrick Bayer & S. Harish & Johannes Urpelainen, 2014. "Information and energy policy preferences: a survey experiment on public opinion about electricity pricing reform in rural India," Economics of Governance, Springer, vol. 15(4), pages 305-327, November.
    15. Voszka, Éva, 2013. "Államosítás, privatizáció, államosítás
      [Nationalization, privatization, nationalization]
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(12), pages 1289-1317.
    16. Marcin Senderski, 2015. "Inhibited privatization: a hurdle race over vested interests," European Journal of Government and Economics, Europa Grande, vol. 4(1), pages 46-66, June.
    17. Castañeda Dower, Paul & Markevich, Andrei, 2014. "A history of resistance to privatization in Russia," Journal of Comparative Economics, Elsevier, vol. 42(4), pages 855-873.
    18. Polterovich (Полтерович), Victor (Виктор), 2012. "Приватизация И Рациональная Структура Собственности. Часть 1. Приватизация: Проблема Эффективности
      [Privatization and the rational ownership structure. Part 1: privatization: the effeciency problem
      ," MPRA Paper 64145, University Library of Munich, Germany.
    19. Cancho,Cesar A. & Davalos,Maria Eugenia & Sanchez,Carolina, 2015. "Why so gloomy ? perceptions of economic mobility in Europe and Central Asia," Policy Research Working Paper Series 7519, The World Bank.

    More about this item

    Keywords

    privatization; revision; nationalization; property rights; demand for property rights; legitimacy of property rights; transition;

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • P36 - Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty

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