Privatization: The theme of the 1990s

Privatization has clearly become the development issue of the 1990s. While not an end in itself, privatization of state owned enterprises should be viewed as a critical element of economic adjustment. Distilled from his extensive involvement with privatization programs, Lieberman identifies the underlying rationale for privatization, presents lessons to be learned in program design, and cautions against pitfalls to successful program implementation.     

The privatization program of the city of St. Petersburg

The privatization program of the City of St. Petersburg is unique in its approach. With over 15,000 enterprises in the City's portfolio, a select group of companies were chosen for pilot transactions prior to creating overarching institutional framework. Drawn from field experience, Bogdanowicz-Bindert and Ryan analyze program progress to date and attempt to draw lessons applicable to a wider spectrum of companies, not only in St. Petersburg, but in Russia in general.     

The privatization experience in Malaysia: Integrating build-operate-own and build-operate-transfer techniques within the national privatization strategy

The Malaysian privatization program is perhaps the most ambitious program found amongst developing or emerging market economies. While the program did not immediately flourish, it is characterized by its development of a well structured institutional framework and creative use of a series of highly innovative restructuring and privatization techniques, the most exciting being the Build-Own-Operate and Build-Operate-Transfer methods.     

Rigorous privatization: The New Zealand experience

New Zealand's experience with privatization is considered by many to be as near “textbook” as the circumstances of politics and business will permit. Franks' analyzes the privatization strategies followed in radically reforming an economy driven by state-owned enterprises.     

The privatization of telecommunications services: The case of Argentina

The Argentine telecommunications system is characterized by its poor quality of service. A deep national economic crisis and a huge fiscal deficit, combined with worldwide changes in the telecommunications sector, lead the Argentine government to the privatization of ENTel beginning in 1989. Herrera provides a detailed account of the economics surrounding the decision to privatize and the privatization program itself.     

Assessing privatization investment opportunities in Thailand

Executive Summary Multinational corporations (MNCs) can find lucrative opportunities to invest in emerging‐market countries by participating in the privatization of state‐owned enterprises. The ability of MNCs to form joint ventures or acquire state enterprises in most countries, however, depends on the characteristics of the government's privatiza‐tion policies and plans, the pace of their implementation, and the mechanisms allowed for foreign investment. In order to assess the feasibility of privatization policies in emerging‐market countries, and especially those undergoing dynamic reforms of their economies, MNCs need a framework for analyzing privatization efforts. The appli‐cation of such a framework is illustrated using the experience with privatization and economic reform in Thailand. © 2000 John Wiley & Sons, Inc.     

Polish Economic Transformation: From Recession to Recovery and the Challenges Ahead

The Polish path from planning to markets was dramatic and risky but the benefits are already beginning to show. The Solidarity-led government introduced simultaneous macroeconomic stabilization and microeconomic liberalization programmes in January 1990. Inflation was successfully brought under control and free markets were rapidly established, but at the same time the country went into a deep recession. However the economy has been experiencing a strong recovery for more than a year, and Poland will probably be the fastest growing economy in Europe in 1993. There has also been major progress in restructuring and, to a lesser extent, privatization. Overall, Poland has made substantial progress towards a West European-type economy.     

The making of an African success story: The privatization of Kenya Airways

This article explores the transformation of Kenya Airways from a loss‐making stateowned enterprise (SOE) to a very successful, profitable African airline and its relationship with KLM‐Royal Dutch Airlines. First, it analyzes the circumstances leading to the creation of Kenya Airways and then discusses the managerial and financial problems it encountered from the period it was set up until it was privatized. It also attempts to explain why and how Kenya Airways has been able to use privatization to avert liquidation. In this regard, it explores the benefits of privatization for the airline and the country as a whole and highlights lessons learned from this experience for the privatization process and strategies in Africa. © 2005 Wiley Periodicals, Inc.     

The Impact of the Concession of 14 Regional Greek Airports on Passenger Traffic

Journal of Industry, Competition and Trade - Greece implemented an extensive privatization program in the past decade, which included the concession of 14 regional airports for a period of...     

Privatizing a distressed state-owned enterprise: Lessons learned through privatization work in Argentina's steel sector

Governments and private investors often widely differ on the definition of value in the privatization of a state-owned enterprise. Many governments attempt to privatize businesses that have questionable potential of creating value from future operation. Mooney and Griffith discuss the issues which arise during the privatization of a “distressed” enterprise through the case experience of Sociedad Mixta Siderurgia Argentina (SOMISA).     

Financial Literacy and Retirement Preparedness: Evidence and Implications for Financial Education

Economists are beginning to investigate the causes and consequences of financial illiteracy to better understand why retirement planning is lacking and why so many households arrive close to retirement with little or no wealth. Our review reveals that many households are unfamiliar with even the most basic economic concepts needed to make saving and investment decisions. Such financial illiteracy is widespread: the young and older people in the United States and other countries appear woefully under-informed about basic financial concepts, with serious implications for saving, retirement planning, mortgages, and other decisions. In response, governments and several nonprofit organizations have undertaken initiatives to enhance financial literacy. The experience of other countries, including a saving campaign in Japan as well as the Swedish pension privatization program, offers insights into possible roles for financial literacy and saving programs. JEL Classification A2, G2     

Effectiveness and Efficiency in Privatization Advertising

The privatization of a number of British nationalized industries during the 1980s involved the use of substantial marketing and, in particular, advertising expenditure. When the same or similar activities are repeated, some experience or learning curve effect can be expected, such that the relative efficiency of performing that activity rises. From an examination of the objectives for and the process of privatization, a learning curve effect might be expected that would result in a progressive lowering of privatization marketing and advertising costs.

The data on privatization from 1981 to 1989 shows the expected learning curve effect for total marketing cost, the total cost reducing over subsequent privatizations. However, the relative cost of advertising first rose and then failed to fall, even when the objectives for privatization changed from widening share ownership to deepening it. The expected learning curve is not then observable, leading to the conclusion that inefficiency existed in the advertising of privatizations, particularly in the late 1980s, and that considerable sums could have been saved if a different strategy had been followed.     

British privatization: Evaluating the results

The 24 studies reviewed here reveal that nine of the 13 primary objectives of the U.K.'s privatization program have substantially been achieved. Privatization has reduced the size and scope of government, reduced political interference in management decisions, freed government funds so they can be used in sectors of the economy other than state-owned businesses, created a free market economy, promoted domestic investment, benefited the economy through higher returns on capital invested in privatized businesses, generated new sources of tax revenue, broadened domestic equity ownership and promoted equity ownership among employees of privatized businesses. Most of the research reviewed concludes that privatization has reduced the government's budget deficit; provided consumers with improved service, better quality, more choices, new products and lower prices; and improved the efficiency and performance of privatized firms. Finally, most of the studies reviewed report mixed results regarding the privatization program's success at reducing government control of business.     

Teaching Western Economics to Eastern Economists

This paper describes and intensive four week workshop for Polish professors of economics. The primary goals of the program were to teach current mainstream Western economics and to introduce U.S. teaching methods to Eastern bloc economists. Prior to this program the professional training of these teachers had been solely or predominantly from officially sanctioned socialist economists.     

Privatization in Eastern Europe: Opportunities and pitfalls

More than 20 years of experience in Eastern Europe has proved that the only way to produce good organizational results is to put companies into the hands of real owners. That means privatization.     

俄罗斯的私有化改革及其对我国国有企业改革的启示

通过对俄罗斯私有化改革及其公司治理问题的分析,结合目前我国国有企业改革过程中出现的主要问题,指出私有化并不是什么灵丹妙药,不是现代公司治理的必经途径,也不是国有企业改革的充分条件。一个国家在进行企业改革时,既要吸取别国成功经验,也应充分考虑本国改革所依赖的制度环境和市场环境,即本国的国情。     

Strategy constraints of Polish foreign-trade organizations

This paper presents reflections on the survey of the general managers of Polish foreign-trade organizations (FTOs). The study focuses on business deals with Western partners and the associated problems. The relative inefficiency of Polish FTOs is due to:

• 1.1. Poor working relations between the FTOs and the Polish manufacturing sector;
• 2.2. Inadequate knowledge of modern marketing techniques;
• 3.3. The lack of clear-cut strategies regarding how to develop foreign markets; and
• 4.4. Rigidity of national planning and management systems in Poland.

As far as organizational solutions to correct the deficiencies are concerned, the experience of foreign branches of FTOs and the modifications of their cooperative links with the Polish manufacturing sector appear to be the most promising.     

Privatization strategies: Is Brazil moving in the wrong gear?

In the 1980s, marketization strategies gained momentum around the globe. Increasingly, the visible hand was being replaced by a revival of neoliberal growth strategies. Privatization was a response to state-owned enterprise, sluggish performance, and excessive intervention in sectors not requiring assistance. In many countries the state became the problem and not the solution for further gains in competitiveness and efficiency. Privatization strategies were implemented more aggressively in Latin America in the 1980s and early 1990s. In Brazil, the largest economy in Latin America, policymakers used erratic strategies from the early 1980s through the early 1990s. This article addresses the Brazilian privatization experience, paying heed to the dynamics of the different strategies pursued throughout the privatization programs and elaborating on the specific steps taken by the Brazilian policymakers. © 1995 John Wiley & Sons, Inc.     

Privatization in Italy: Roundtable discussion with Paolo Savona the italian minister of industry

Over the last few years, the Italian government has intensified its privatization program of state-owned industries. Since 1989, it has privatized the banking and food industries and will begin work on the telecom and insurance industries in late 1994. Paolo Savona, the Minister of Industry, has been in part responsible for these reforms. In his comments to the Italian Academy of Advanced Studies at Columbia University, he outlines the constitutional and cultural difficulties that Italy has faced in its privatization program, and asserts that through reducing the public debt, improving efficiency, and enlarging capital and other markets, the Italian economy will be better prepared for the 21st Century.     

Privatization of health care services in Canada: Reform or regress?

The emergence of the privatization of health care services as one of the dominant health policy issues in many western industrialized countries is no doubt related to a number of factors, including rising health care costs, fiscal crisis in the form of budgetary deficits, charges of public waste and mismanagement and underfunding, the onset of a new era of political and fiscal conservatism, and professional and corporate antipathy to certain aspects of publicly financed health insurance schemes. The paper discusses the meaning of privatization and stresses the importance of recognizing the different forms of privatization and the need to assess these forms against well specified health policy objectives. Current and proposed forms of privatization in Canada are described and evaluated. It is concluded that there are sound arguments against privatization through user fees for insured physician and hospital services. As for the other forms of privatization there are confusing and inconsistent findings that preclude a definitive conclusion as to the wisdom of a general push for privatization. It is stressed that there are not many empirically established facts about the likely effects of privatization and the many claims about the virtues of privatization are far from substantiated by careful research. In the absence of such evidence the push for reprivatization seems, as some critics have pointed out, ideologically motivated.