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Privatize or Not? Escaping Budget Temptation and Nirvana Fallacy

Author

Listed:
  • Afontsev, S.

    (Institute for World Economy and International Relations, Moscow, Russia)

Abstract

The article argues that most objections against a new wave of privatization in Russia suffer from a 'Nirvana fallacy', i.e., rely on undue comparison of limited (yet positive) results of actual privatization policies with the alleged ability of the government to raise efficiency of non-privatized enterprises. Empirical results available thus far suggest that optimal policy choice is to combine privatization with proactive competition policies.

Suggested Citation

  • Afontsev, S., 2013. "Privatize or Not? Escaping Budget Temptation and Nirvana Fallacy," Journal of the New Economic Association, New Economic Association, vol. 20(4), pages 150-153.
    • Handle: RePEc:nea:journl:y:2013:i:20:p:150-153
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    References listed on IDEAS

    as
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    7. Okten, Cagla & Arin, K. Peren, 2006. "The Effects of Privatization on Efficiency: How Does Privatization Work?," World Development, Elsevier, vol. 34(9), pages 1537-1556, September.
    8. Rafael La Porta & Florencio López-de-Silanes, 1999. "The Benefits of Privatization: Evidence from Mexico," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(4), pages 1193-1242.
    9. Ksenia Yudaeva & Konstantin Kozlov & Natalia Melentieva & Natalia Ponomareva, 2003. "Does foreign ownership matter?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 11(3), pages 383-409, September.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    privatization; competition policies; microeconomic efficiency;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out

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