Hi! Thanks for the question.
I shall answer your question in point by point fashion. I will also
provide small snippets from the articles but I highly recommend that
you read the articles in their entirety so as to get a beeter coverage
of the ideas.
1. What is privatization?
"In its purest form, the term refers to the shifting of the production
of a good or the provision of a service from the government to the
private sector, often by selling government-owned assets."
"Most definitions of privatization, though, are more expansive,
covering virtually any action that involves exposing the operations of
government to the pressures of the commercial marketplace."
"What is Privatization?
http://www.privatization.org/database/WhatIsPrivatization.html
2. What are the benefits of privatization?
- "promote efficiency by exposing businesses and services to the
greatest possible competition, to the benefit of the consumer"
- "spread share ownership as widely as possible among the population"
- "obtain the best value for each industry or service the government
sells."
"PRIVATIZATION OBJECTIVES"
http://www.privatization.org/Collection/Publications/htg_15--divesting_assets.htm
3. What are the costs of Privatization?
Our inital links regarding this matter is taken from a local level
point of view but is also true in a large setting privatization
program.
- "Opponents see privatization as economically inefficient. The cost
of contracting out is high."
- "The public sector remains responsible for service provision."
- "Contractors can "low-ball" bids and recoup their losses during the
contract or at renewal time."
- "Other hidden costs are often ignored, such as public equipment and
services provided to contracts, and hiring or training technicians and
managers to monitor the private sector."
- "Opponents point out that quality is hard to monitor in some service
areas. To make a profit, private firms will need to cut labor costs
which may result in employment of less competent or experienced
workers."
- "Many public services lend themselves to monopoly provision due to
obvious economies of scale."
"The Costs and Benefits of Privatization at the Local Level in New
York State"
http://www.cardi.cornell.edu/research_briefs/CDR3-2.cfm
- "A significant potential disadvantage of privatization is the cost
to implement a performance-monitoring plan of the service being
provided."
- "Privatization is anti-public employee; people will lose
their jobs."
- "It breeds special interests and corrupts the process."
- "If it does work, officials may not do the right thing with
the savings."
"Introducing the Competi-tion Process to Improve Performance"
http://www.rbg.com/images/PublicFL02.pdf
4. The Regulator:
"In the case of some privatized industries, especially utilities and
other enterprises (e.g. airports or toll roads and bridges) which may
have some monopoly characteristics, some form of independent
regulation will be needed until a fully competitive market has
developed or to achieve the benefits of competition. The government
will need to address this need at an early stage in the sale
preparations."
5. Role of the Regulator
- "Broadly the aim of a regulatory regime is to put in place a
framework of regulation which is explicit and transparent in nature
and which operates through incentives on managers of the business
rather than through the complex administrative arrangements which has
characterized control under government ownership."
- "Where competition cannot be introduced or will take some time to
develop, the regulator's role is to protect consumers from abuses of
monopoly power.:
Regulation
http://www.privatization.org/Collection/Publications/htg_15--divesting_assets.htm#5
Search at Google and Froogle for the terms:
privatization pros cons issues
I hope these links would help you in your research. Before rating this
answer, please ask for a clarification if you have a question or if
you would need further information.
Thanks for visiting us.
Regards,
Easterangel-ga
Google Answers Researcher |
