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Public Enterprises – Objectives and Performance

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  • Johan WILLNER

    ()

  • Sonja GRÖNBLOM

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Abstract

Public ownership is a way to provide goods and services where market performance is not satisfactory, or when the economy would otherwise be stagnant, provided that its costs do not overshadow its benefits. We provide a brief review of the existing theoretical and empirical literature. While far from exhaustive, the review suggests that there is no unanimous body of research showing that public ownership is inefficient to such an extent that private ownership is always socially superior. More research is needed on the costs and benefits of different forms of ownership, and we emphasise the need of analysing potential intrinsic motivation, service quality and the impact of international competition. Moreover, the fact that privatisation has often been implemented through outsourcing suggests a need of analysing renationalisation through buyer power.

Suggested Citation

  • Johan WILLNER & Sonja GRÖNBLOM, 2017. "Public Enterprises – Objectives and Performance," Departmental Working Papers 2017-03, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
  • Handle: RePEc:mil:wpdepa:2017-03
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    File URL: http://wp.demm.unimi.it/files/wp/2017/DEMM-2017_03wp.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Public ownership; Cost efficiency; Intrinsic motivation; Quality; International competition; Renationalisation;

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • H44 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Goods: Mixed Markets
    • 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

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