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A note on privatizations and public sector net worth: what (not) to learn from the UK experience

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  • Massimo FLORIO

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Abstract

The paper shows that privatisation can contribute to the decrease of net public debt, but at the same time can decrease the Public Sector Net Worth. This is defined as the difference between public sector assets and liabilities. The UK in the 1980s and 1990s is an example of parallelism between divestiture and worsening of the PSNW. The paper is divided into four short sections. In the first we refer to the general concept of Public Sector Net Worth (PSNW). In the second section we present some data for the UK experience of privatization. In the third section we develop a simple conceptual model that shows which variables are at stake and how they are related. We conclude with some implications for economic policy

Suggested Citation

  • Massimo FLORIO, 2007. "A note on privatizations and public sector net worth: what (not) to learn from the UK experience," Departmental Working Papers 2007-18, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
  • Handle: RePEc:mil:wpdepa:2007-18
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    File URL: http://wp.demm.unimi.it/files/wp/2007/DEMM-2007_018wp.pdf
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    References listed on IDEAS

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    Cited by:

    1. Emanuele Bacchiocchi & Elisa Borghi & Alessandro Missale, 2011. "Public Investment under Fiscal Constraints," Fiscal Studies, Institute for Fiscal Studies, pages 11-42.
    2. Chiara Del Bo & Massimo Florio & Silvia Vignetti & Emanuela Sirtori, 2011. "Additionality and regional development: are EU Structural Funds complements or substitutes of national Public Finance?," Working Papers 201101, CSIL Centre for Industrial Studies.

    More about this item

    Keywords

    Privatization; public sector net worth; public debt;

    JEL classification:

    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • H82 - Public Economics - - Miscellaneous Issues - - - Governmental Property

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