Why are so many emerging economies privatizing state-owned enterprises, and how does that affect their performance? The author proposes a dynamic multilevel model to answer these questions. Firm-level arguments need to be complemented by industry- and country-level arguments to explain why some enterprises are privatized but not others. Similarly, changes in firm governance resulting from privatization are only one determinant of postprivatization performance: changes in industry structure, regulation, and country-level variables are as important. Furthermore, changes introduced at all three levels in one round of reform influence the context within which subsequent privatizations occur.
No takes yet. Share an insight, caveat, or question.
Ravi Ramamurti (2000) studied this question.