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Privatisation Methods and Economic Growth in Transition Economies

Author

Listed:
  • John Bennett

    (Brunel University)

  • Saul Estrin

    (London Business School)

  • James Maw

    (University of Wales Swansea)

  • Giovanni Urga

    (Cass Business School)

Abstract

We investigate the impact of differences in privatisation method on national economic performance in transition economies. Our approach is to estimate, using dynamic panel data methods, a growth equation over 23 countries for the period 1990-2001. Among our results, we find that mass privatisation has significant positive effect on growth across a wide variety of definitions and specifications. This result holds with particular force after 1995, i.e., once the period of early transition and recession was over. Our analysis suggests that an advantage of mass privatisation was that it led spontaneously to development of the capital market, which is significantly correlated with economic growth.

Suggested Citation

  • John Bennett & Saul Estrin & James Maw & Giovanni Urga, 2004. "Privatisation Methods and Economic Growth in Transition Economies," Working Papers 2004.105, Fondazione Eni Enrico Mattei.
  • Handle: RePEc:fem:femwpa:2004.105
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    References listed on IDEAS

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    Cited by:

    1. Mico Apostolov, 2013. "Governance and enterprise restructuring in Southeast Europe," International Journal of Social Economics, Emerald Group Publishing, vol. 40(8), pages 680-691, June.
    2. Ahrend, Rüdiger, 2012. "Understanding Russian regions’ economic performance during periods of decline and growth—An extreme bound analysis approach," Economic Systems, Elsevier, vol. 36(3), pages 426-443.
    3. Fungáčová, Zuzana & Hanousek, Jan, 2006. "A castle built on sand : the effects of mass privatization on stock market creation in transition economies," BOFIT Discussion Papers 14/2006, Bank of Finland, Institute for Economies in Transition.
    4. Marina Bakanova, & Saul Estrin & Igor Pelipas & Sergei Pukovic, 2006. "Enterprise Restructuring in Belarus," William Davidson Institute Working Papers Series 823, William Davidson Institute at the University of Michigan.
    5. Campos, Nauro F & Kinoshita, Yuko, 2008. "Foreign Direct Investment and Structural Reforms: Evidence from Eastern Europe and Latin America," IZA Discussion Papers 3332, Institute for the Study of Labor (IZA).
    6. Crivelli, Ernesto, 2013. "Fiscal impact of privatization revisited: The role of tax revenues in transition economies," Economic Systems, Elsevier, vol. 37(2), pages 217-232.
    7. Bakanova, Marina & Estrin, Saul & Pelipas, Igor & Pukovich, Sergei, 2006. "Enterprise Restructuring in Belarus," IZA Discussion Papers 2148, Institute for the Study of Labor (IZA).
    8. Gouret, Fabian, 2007. "Privatization and output behavior during the transition: Methods matter!," Journal of Comparative Economics, Elsevier, vol. 35(1), pages 3-34, March.
    9. Emanuele Bacchiocchi & Massimo Florio, 2008. "Privatisation and aggregate output: testing for macroeconomic transmission channels," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 35(5), pages 525-545, December.
    10. Irina Denisova & Markus Eller & Timothy Frye & Ekaterina Zhuravskaya, 2007. "Who Wants to Revise Privatization and Why? Evidence from 28 Post-Communist Countries," Working Papers w0105, Center for Economic and Financial Research (CEFIR).
    11. Armand Krasniqi, 2016. "The issue of the liquidation process of social enterprises during privatization process in Kosovo," Juridical Tribune (Tribuna Juridica), Bucharest Academy of Economic Studies, Law Department, vol. 6(Special), pages 186-195, October.
    12. Zuzana Fungacova, 2005. "Building a Castle on Sand: Effects of Mass Privatization on Capital Market Creation in Transition Economies," CERGE-EI Working Papers wp256, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    13. Apostolov, Mico, 2011. "Governance and Enterprise Restructuring - the case of Macedonia," MPRA Paper 29098, University Library of Munich, Germany.
    14. Anis Chowdhury, 2012. "Structural Adjustment and Crises –Which Way Now?," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 4(1), pages 85-118, April.
    15. Elena Yusupova, 2006. "Information Asymmetry, Share Mispricing and the Coordination Problem: Investor Portfolio Choice in Czech Voucher Privatization," CERGE-EI Working Papers wp301, The Center for Economic Research and Graduate Education - Economics Institute, Prague.

    More about this item

    Keywords

    Privatization; Method; Economic Growth; Transition;

    JEL classification:

    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • P27 - Economic Systems - - Socialist Systems and Transition Economies - - - Performance and Prospects
    • P31 - Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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