Between 1977 and 2001 more than 3,535 privatization operations were carried out in the world, bringing government revenues of over $1,127 billion. The phenomenon involved over 100 countries, and all sectors in which state-owned enterprises usually operate: agriculture and industry, finance, telecommunications, energy, and public utilities. Beyond aggregate figures, the process took different forms and yielded different outcomes in various countries.
This book presents a thorough empirical analysis that makes it possible to identify the main trends and patterns of privatization worldwide. However, it is not simply a collection of stylized facts. Rather, it aims at explaining why and how privatization takes place, trying to simplify the wider complexity of the process.
Our work has an underlying thesis. We try to prove that privatization has been a very varied process in different parts of the world, seldom decided upon autonomously, more often forced by external factors and carried out reluctantly in the absence of suitable legal, political, and economic institutions. As a result, in most cases, privatization has been incomplete and fraught with error. However, privatization is partly an irreversible process that may lead to institutional innovation and market development.
We argue that privatization outcomes can be explained by a unified framework suitable for understanding whether privatization is a trend or a cycle, for identifying the factors shaping the evolution of the process over time, and for considering why private ownership is likely to coexist with public control, at least in the near future.
23 April 2003