The Return of Public Enterprise

Abstract

Public enterprises never disappeared in spite of several privatization waves in the last three decades. This paper offers some trends and possible rationales for their resilience. In a sample of the Forbes 2000 top corporations, as reviewed by OECD economists (Kowalski et al. 2013), we show that the around ten per cent of state-owned enterprises perform better in financial terms than their private counterparts. The Great Recession has also shown that governments had to take over failing major private enterprises, including particularly banks. In several countries, particularly in Western Europe, there is municipalization of electricity and water distribution. In the EU/15, there is also evidence that in electricity and gas, government owned incumbents offer fairer prices to households than private competitors. Recent research on mergers and acquisitions confirms that in the last ten years there has been an increase of publicization relative to privatization, including through trans-border deals.

Institutions and Firms' Productivity: Evidence from Electricity Distribution in the EU

“…Then there are minority stakes in companies, plus USD 2 trillion or so in utilities and other assets held by local governments.' Moreover, during the global economic crisis of 2008, we have witnessed a greater direct involvement of governments of developed and emerging countries in economic activities: for example, around 2010, more than 10% of firms in the Forbes Global 2000 list are state-owned (Kowalski et al, 2013;Florio, 2014). Firms in this group include major corporations in different countries such as China, India, Brazil, Russia, Turkey, but also France, Italy, Germany, Sweden and several others in Europe.…”

Determinantes de la innovación en empresas propiedad del Estado: evidencia para las empresas públicas de Ecuador

“…Public enterprises are defined as economic organizations: a) owned or co-owned by national or local government; b) that internalize a public mission among their objectives; c) that possess partial or total budgetary autonomy; d) that show discretion in the management; e) that are committed to business activities; and f) where privatization could at first be possible or de facto, but for various reasons it is not an option (Florio, 2014b;Short, 1984). In current articles, State-Owned Enterprises (SOEs) are referred to, with these being one hundred percent of public capital (Florio, 2014a;Goldeng, Grünfeld, & Benito, 2008;Penfold, Oneto, & Rodríguez Guzmán, 2015), differentiating them from the mixed enterprises, which consist of agreements shared between the public sector and private operators or financial investors (Cruz, Marques, Marra, & Pozzi, 2014;Vining, Boardman, & Moore, 2014).…”

Duopoly, Optimal Proportion of State-Owned Shares and International Cross-Ownership

“…Researches on the proportion of state-owned shares: The past few decades have witnessed a global wave of privatization of state-owned enterprises and the major reform measures are issuing shares and mergers and acquisitions (Florio, 2014). A large number of state-owned enterprises achieve partial or full privatization on the basis of overcoming the drawbacks of state-owned enterprise system and promoting enterprise effi ciency, which attracts much attention of scholars.…”