Nationalizations and effciency

Crivelli, Ernesto und Staal, Klaas (Juli 2009): Nationalizations and effciency. SFB/TR 15 Discussion Paper No. 268

Abstract

We develop a theoretical model in which ?rms are either private or state-owned. When ?rms become insolvent, the government can intervene with general measures, like subsidies, or by nationalizing ?rms. The government only intervenes when the bankruptcy of a ?rm entails social costs. In a stylized model, we analyze how government interventions a?ect allocative and productive efficiency. Nationalization of private ?rms in case unpro?table investments were made, leads to increased allocative efficiency despite private ownership. The effort level chosen by the managers working for ?rms is also affected by government intervention with an impact on productive efficiency.

• Dokumententyp: Paper
• Keywords: nationalization, efficiency
• Fakultät: Sonderforschungsbereiche > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems ; Sonderforschungsbereiche > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems > A5 - Unvollständige Vertragsbeziehungen und die Gestaltung von Residualrechten
• Themengebiete: 300 Sozialwissenschaften > 330 Wirtschaft
• JEL Classification: L33, P31, P51
• Sprache: Englisch