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Who gets privatised? An empirical analysis of Polish manufacturing


  • Katarzyna Mikolajczyk
  • Barbara M. Roberts



This paper employs a multinomial logit model to examine what determines the choice of a particular firm for a given privatisation method. A variety of hypotheses about possible determinants of ownership change are tested using an extensive data set for Polish manufacturing at the beginning of transition. The results at a firm as well as at a sector level give strong support to the hypothesis of the importance of resource constraints on the choice of ownership. Large firms with high financing requirement are more likely to be owned by outsiders. High sectoral capital intensity discourages small insider owned firms while high degree of product differentiation is a constraint for different investors, with the exception of outsiders. We also find that firm quality, measured by profitability and exporting outside the Soviet block, appeals to all types of investors but, additionally, privatisation offers outsiders ways of entering sectors with substantial entry barriers.

Suggested Citation

  • Katarzyna Mikolajczyk & Barbara M. Roberts, 2004. "Who gets privatised? An empirical analysis of Polish manufacturing," Discussion Papers in Economics 04/9, Department of Economics, University of Leicester.
  • Handle: RePEc:lec:leecon:04/9

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    References listed on IDEAS

    1. Lemos Sara, 2005. "Political Variables as Instruments for the Minimum Wage," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 4(1), pages 1-33, December.
    2. Pablo Fajnzylber, 2001. "Minimum Wage Effects Throughout the Wage Distribution: Evidence from Brazil's Formal and Informal Sectors," Anais do XXIX Encontro Nacional de Economia [Proceedings of the 29th Brazilian Economics Meeting] 098, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
    3. Brown, Charles, 1999. "Minimum wages, employment, and the distribution of income," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 32, pages 2101-2163 Elsevier.
    4. Sara lemos, 2004. "The Effects of the Minimum Wage in the Private and Public Sectors in Brazil," Discussion Papers in Economics 04/12, Department of Economics, University of Leicester.
    5. Dickens, Richard & Machin, Stephen & Manning, Alan, 1999. "The Effects of Minimum Wages on Employment: Theory and Evidence from Britain," Journal of Labor Economics, University of Chicago Press, vol. 17(1), pages 1-22, January.
    6. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
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    More about this item


    privatisation methods; ownership change; multinomial logit;

    JEL classification:

    • P21 - Economic Systems - - Socialist Systems and Transition Economies - - - Planning, Coordination, and Reform
    • P31 - Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities

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