Privatization in Eastern Germany
Subtitle: a neo-institutional analysis
By: Herbert Brücker.
Series: GDI book series ;; no. 8
Publisher: Frank Cass
Published: 1997
Place of publication: London; Portland, OR
Language: eng
Number of pages: 283
Subjects: Privatization -- Germany (East)
Description: This book gives the first comprehensive analysis of privatization and restructuring by the Treuhandanstalt in East Germany. It also addresses the theoretical and conceptual problems of large-scale privatization in the transformation process. Contrary to many transition economies, the East German privatization approach was based on the sale of state-owned companies to strategic investors under the constraint of a mixed set of allocative criteria, including employment and investment objectives. In order to achieve these objectives, the Treuhandanstalt frequently granted huge subsidies to private investors. This required the negotiation and enforcement of complex contracts. This approach encountered widespread criticism in the public as well as the academic literature.

However, under the circumstances of incomplete information and high uncertainty, the Treuhand strategy of informal negotiations and complex contracts can be defended as more efficient than standardized privatization procedures such as auctions and vouchers.
Notes: Includes bibliographical references (p. 251-283).
"Published in association with the German Development Institute, Berlin."