Discussion of Dr Galán’s Paper

Dr Nyers said that Dr Galán’s paper contained both general statements about public enterprise and specific remarks about the experience of Spain, and this dual character was interesting. He said that in developing countries public enterprise played an important role not only in the provision of public services, but also in the promotion of industries which the market failed to enter, because they required very large investments, or were new and risky. He said it was important that public enterprise be financially self-sufficient, and did not drain resources from other sectors of the economy. He considered the role of INI in Spain useful in that it co-ordinated investment and growth among firms in different sectors of the economy. But he said there was a temptation to increase central control over these firms unduly, which could lead to problems of bureaucracy. The best solution was an intermediate one between complete decentralisation and too much centralism. Finally, he said that he thought workers’ participation was essential for good performance of a public enterprise. The socialist countries were currently experimenting to find the best form of workers’ participation in management.