Journal article
Privatization and state ownership of natural advantage industries
The Quarterly review of economics and finance, Vol.76, pp.68-83
05/01/2020
DOI: 10.1016/j.qref.2019.08.005
Abstract
•Ultimate state ownership is higher when competition is lower.•Ultimate state ownership is higher when agglomeration economies are higher.•Governments tend to privatize larger firms, but only where corruption is more curbed.•Ultimate state ownership results in a deterioration of firm performance.•Share-issue privatizations improve firm performance more than asset sales.
Using a hand-collected sample of state-owned enterprises and newly privatized firms around the globe, we investigate state ownership patterns in natural advantage (substantial oil reserves or mineral deposits) industries. We find that ultimate state ownership is higher when competition is lower and when economic activity is more geographically concentrated. We also observe that governments tend to privatize larger firms, confirming the selection bias concerns of earlier studies, but only where corruption is curbed. Finally, we confirm that ultimate state ownership results in a deterioration of firm performance and that share-issue privatizations improve firm performance more than asset sales.
Details
- Title: Subtitle
- Privatization and state ownership of natural advantage industries
- Creators
- Jean-Claude Cosset - HEC MontréalArt Durnev - University of IowaIgor Oliveira dos Santos - HEC Montréal
- Resource Type
- Journal article
- Publication Details
- The Quarterly review of economics and finance, Vol.76, pp.68-83
- DOI
- 10.1016/j.qref.2019.08.005
- ISSN
- 1062-9769
- eISSN
- 1878-4259
- Publisher
- Elsevier Inc
- Grant note
- DOI: 10.13039/100008240, name: Fonds de Recherche du Québec-Société et Culture
- Language
- English
- Date published
- 05/01/2020
- Academic Unit
- Finance
- Record Identifier
- 9984380482302771
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