31 Annex A: Studies on Privatization

|Authors|**Methodology**|MainFindings|
|---|---|---|
|**A.General**|||
|Bamet.Steven.<br>2000."Evidence<br>onthe FiscalandMacroeconomic<br>Impactof<br>Privatization.'<br>_IMF_<br>_Working_<br>_Paper_<br>_WP/00/130._<br>Washington<br>D.C.:<br>Intemational<br>MonetaryFund.<br>htt):I/www.imf.oralextemal/oubs/ftJw<br>D/2000w"00130.odt|Thestudyinvestigatestheimpactof<br>privatzation<br>on<br>fiscal<br>and<br>macroeconomicperformance.|Privatizationproceeds transferredtothe budget<sup>are</sup><br>largelyusedtoreducedomestcfinancing,<sup>withlitte</sup><br>evidence thattheyareused to finance<sup>alarger</sup><br>deficit.<br>Theprivatzationprocessisstrongly<br>correlatedwithanimprovementinmacroeconomic<br>performanceintheformofhigherrealGDP<sup>growth</sup><br>andlower unemploymentrates.The<sup>estimates</sup><br>suggestthataonepercentofGDP<sup>privatization</sup><br>corresponds to 0.5percentage pointincrease<sup>in</sup><br>contemporaneousrealGDPgrowthandafurther<sup>0.4</sup><br>percentage point increaseinthe followingyear.<sup>The</sup><br>point estimatesalsosuggestthataone percent<sup>of</sup><br>GDPprivatizationisassociatedwithadeclinein<sup>the</sup><br>unemploymentrateofjustlessthan_/._<sup>of</sup>a<br>percentage pointintheyearofprivatization<sup>anda</sup><br>further/.percentagepointin thefollowing<sup>year,</sup><br>resultinginatotalimpactofaround%<sup>ofa</sup><br>percentagepoint|
|Boardman,AnthonyE.,andAldan<br>R.Vining.<br>1989.'Ownershipand<br>Performance<br>in<br>Competitive<br>Environments:AComparisonofthe<br>PerformanceofPrivate,Mixed, and<br>State-OwnedEnterprises."<br>Joumal<br>_ofLawandEconomics._32: 1-33.|Contains<br>a<br>comparlson<br>of<br>the<br>performanceofthe500largestnon-US<br>industrialfirmsin1983.<br>Resultsare<br>comparedforprivatecorporations,mixed<br>enterprisesandstate-owned enterprises.<br>Thecomparisonisonthebasisoffour<br>measures<br>ofprofitability:<br>return<br>on<br>equity,return onassets,retum onsales<br>andnetincome.<br>Also includestwo<br>measuresofX-effidency:sales<sup>per</sup><br>employeeandsalesperasset|Theauthorsfindthatstate-ownedand<sup>mixed</sup><br>ownershipfirmsaresignificantlylessprofitable<sup>and</sup><br>productive than privately-ownedcompanies.<sup>To gain</sup><br>efficiencyfullprivatizationisneededbecause<sup>mixed</sup><br>ownershipsfirms arenomore profitablethan<sup>those</sup><br>ownedwhollyby the state.|
|Boubakri,Narjess,andJean-Claude<br>Cosset<br>1998.'TheFinandaland<br>OperatingPerformanceofNewly<br>PrivatizedFirms:EvidenceFrom<br>Developing Countries."<br>Joumalof<br>_Finance._53:1081-1110.|Thestudyexaminespost-privatizabon<br>financial andoperatingperformanceof<br>79 companiesin21developing countries<br>and32industriesbetween198g01992.|Thestudyconcludesthatthereareeconomically<sup>and</sup><br>statisticallysignificantpost-privatization<sup>increasesin</sup><br>output(realsales),operatngefficiency,<sup>profitability,</sup><br>capitalinvestrnentspending,dividend payments,<sup>and</sup><br>employmentaswellas significant decreases<sup>in</sup><br>leverage.About 60percentofsamplefirmsshowed<br>anincreaseinemploymentof5-10percentafter<br>privatization.Realsalesperemployeeincreased<sup>by</sup><br>27percentUnadjustednetincomeperemployee<br>increasedonaverageby63percent|
|Davis, Jeffrey, RolandoOssowski,<br>ThomasRichardsonandSteven<br>Bamett.<br>2000.<br>'Fiscal<br>and<br>Macroeconomic<br>Aspects<br>of<br>Privatization.'<br>_IMF_<br>_Occasional_<br>_PaperNo.194._<br>WashingtonD.C.:<br>IntemabonalMonetaryFund.|Thispaper separatesthepossiblefiscal<br>and other macroeconomic impacts<sup>of</sup><br>privaization.|Thestudyfindsthatreceipts**of**prtvatzaton<sup>are</sup><br>savedratherthanspentOvertimethe<sup>fiscalsituation</sup><br>Isimprovedbyprivatizabon<sup>withposiSveimpacts</sup><br>uponrevenueandforsomecountriesa<sup>argededine</sup><br>Indefidts.Intermsofgrowthprivatefirms<sup>**am**found</sup><br>tobemoreefficientthanthoserunby<sup>thestate,</sup><br>especiallyin competitiveindustrbies.<sup>Thestrong</sup><br>correlation<br>that<br>exists<br>between<br>growth<br>and<br>privatzabonmay bebecauseprivatkationisa<sup>proxy</sup><br>forthemoregeneralfactorof'favorableregime<br>change'.Theauthorsalsofindthatunemployment<br>falls<br>after privazatbon,<br>butthatitmay have<br>detrimentalimpactsonpariculargroupsofworkers.<br>Overalltheposibiveeffectsofprivatizationongrowth<br>and employmentholdforallcountriesexamined,<br>althoughtoalesserextentintransitlon<sup>economies.</sup>|