IDEAS home Printed from https://ideas.repec.org/p/crc/wpaper/1520.html
   My bibliography  Save this paper

The Organisation of Services of General Interest in Finland

Author

Listed:
  • Johan WILLNER

    (Åbo Akademi University, Department of Economics, Turku, Finland)

  • Sonja GRÖNBLOM

Abstract

Like in most other European countries, services of general interest in Finland have in recent years been subject to competition, increased private provision, and in some cases privatisation. This development is motivated by expected cost reductions, by EUregulations, by ideology and fashion, and in some cases also by a desire to generate sales revenues. Empirical evaluations have provided mixed results, but the relatively successful history of Finland’s state enterprises makes it hard to believe that the public sector would be unable to organise SGI-services efficiently. A number of potential market failures suggest that renationalisation should be taken seriously as an alternative to regulation. This would not necessarily be a very radical policy, because public ownership is still fairly prominent among SGIs in Finland

Suggested Citation

  • Johan WILLNER & Sonja GRÖNBLOM, 2015. "The Organisation of Services of General Interest in Finland," CIRIEC Working Papers 1520, CIRIEC - Université de Liège.
    • Handle: RePEc:crc:wpaper:1520
    as

    Download full text from publisher

    File URL: https://www.ciriec.uliege.be/repec/WP15-20.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Gunther Tichy, 2001. "What Do We Know about Success and Failure of Mergers?—Rejoinder," Journal of Industry, Competition and Trade, Springer, vol. 1(4), pages 431-440, December.
    2. Francisco de Castro & Matteo Salto & Hugo Steiner, 2013. "The gap between public and private wages: new evidence for the EU," European Economy - Economic Papers 2008 - 2015 508, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    3. Belleflamme,Paul & Peitz,Martin, 2010. "Industrial Organization," Cambridge Books, Cambridge University Press, number 9780521681599, November.
    4. Alamdari, Fariba E. & Morrell, Peter, 1997. "Airline labour cost reduction: post-liberalisation experience in the USA and Europe," Journal of Air Transport Management, Elsevier, vol. 3(2), pages 53-66.
    5. Friedrich Schneider, 2003. "Privatisation in OECD Countries: Theoretical Reasons and Results Obtained," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 1(03), pages 24-29, February.
    6. Laffont, Jean-Jacques & Tirole, Jean, 1991. "Privatization and Incentives," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 7(0), pages 84-105, Special I.
    7. Reiner Martin & Moreno Roma & Isabel Vansteenkiste, 2005. "Regulatory reforms in selected EU network industries," Occasional Paper Series 28, European Central Bank.
    8. Gugler, Klaus & Liebensteiner, Mario & Schmitt, Stephan, 2017. "Vertical disintegration in the European electricity sector: Empirical evidence on lost synergies," International Journal of Industrial Organization, Elsevier, vol. 52(C), pages 450-478.
    9. Jeffry M. Netter & William L. Megginson, 2001. "From State to Market: A Survey of Empirical Studies on Privatization," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 321-389, June.
    10. Dani Rodrik, 2000. "How Far Will International Economic Integration Go?," Journal of Economic Perspectives, American Economic Association, vol. 14(1), pages 177-186, Winter.
    11. Maria Kopsakangas-Savolainen, 2003. "Quantity versus Price Competition in the Deregulated Finnish Electricity Markets," Finnish Economic Papers, Finnish Economic Association, vol. 16(2), pages 51-60, Autumn.
    12. Sonja Grönblom & Johan Willner, 2014. "Organisational form and individual motivation: public ownership, privatisation and fat cats," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 17(3), pages 267-284, July.
    13. Willner, Johan, 2001. "Ownership, efficiency, and political interference," European Journal of Political Economy, Elsevier, vol. 17(4), pages 723-748, November.
    14. Rothkopf, Michael H., 2007. "Dealing with Failed Deregulation: What Would Price C. Watts Do?," The Electricity Journal, Elsevier, vol. 20(7), pages 10-16.
    15. John Kwoka, 2008. "Restructuring the U.S. Electric Power Sector: A Review of Recent Studies," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 32(3), pages 165-196, May.
    16. Buehler Stefan, 2005. "The Promise and Pitfalls of Restructuring Network Industries," German Economic Review, De Gruyter, vol. 6(2), pages 205-228, May.
    17. Pablo Arocena & David S. Saal & Tim Coelli, 2012. "Vertical and Horizontal Scope Economies in the Regulated U . S . Electric Power Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 60(3), pages 434-467, September.
    18. Sung, Nakil, 1998. "The embodiment hypothesis revisited: evidence from the U.S. local exchange carriers," Information Economics and Policy, Elsevier, vol. 10(2), pages 219-235, June.
    19. Luoma, Kalevi & Hjerppe, Reino, 1997. "Finnish Experiences in Measuring and Promoting Productivity in the Public Sector," Discussion Papers 150, VATT Institute for Economic Research.
    20. Bruno S. Frey & Matthias Benz, 2005. "Can Private Learn from Public Governance?," Economic Journal, Royal Economic Society, vol. 115(507), pages 377-396, November.
    21. Martin Stephen, 1993. "Endogenous Firm Efficiency in a Cournot Principal-Agent Model," Journal of Economic Theory, Elsevier, vol. 59(2), pages 445-450, April.
    22. Belleflamme,Paul & Peitz,Martin, 2015. "Industrial Organization," Cambridge Books, Cambridge University Press, number 9781107687899.
    23. Thomas, Steve, 2006. "The grin of the Cheshire cat," Energy Policy, Elsevier, vol. 34(15), pages 1974-1983, October.
    24. Friedrich Schneider, 2003. "Privatisation in OECD Countries: Theoretical Reasons and Results Obtained," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 1(3), pages 24-29, 02.
    25. Barrett, Sean D, 1997. "The implications of the Ireland-UK airline deregulation for an EU internal market," Journal of Air Transport Management, Elsevier, vol. 3(2), pages 67-73.
    26. Emiel F.M. Wubben & William Hulsink (ed.), 2003. "On Creating Competition and Strategic Restructuring," Books, Edward Elgar Publishing, number 3059.
    27. Sulamaa, Pekka, . "Essays in Deregulated Finnish and Nordic Electricity Markets," ETLA A, The Research Institute of the Finnish Economy, number 34, June.
    28. Sonja Grönblom & Johan Willner, 2014. "Organisational form and individual motivation: public ownership, privatisation and fat cats," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 17(3), pages 267-284, September.
    29. Lorenz NETT, 1993. "Mixed Oligopoly With Homogeneous Goods," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 64(3), pages 367-393, July.
    30. Dixit, Avinash, 1997. "Power of Incentives in Private versus Public Organizations," American Economic Review, American Economic Association, vol. 87(2), pages 378-382, May.
    31. Massimo Florio, 2006. "The Great Divestiture: Evaluating the Welfare Impact of the British Privatizations, 1979-1997," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262562227, April.
    32. Jason P. Martinek & Michael J. Orlando, 2002. "Neither Lucky Nor Good - The Case of Electricity Deregulation in California," The Economic and Social Review, Economic and Social Studies, vol. 33(1), pages 75-82.
    33. Martin, Reiner & Roma, Moreno & Vansteenkiste, Isabel, 2005. "Regulatory reforms in selected EU network industries," Occasional Paper Series 28, European Central Bank.
    34. Johan Willner & David Parker, 2007. "The Performance of Public and Private Enterprise under Conditions of Active and Passive Ownership and Competition and Monopoly," Journal of Economics, Springer, vol. 90(3), pages 221-253, April.
    35. Johan Willner, 2008. "Liberalisation, competition and ownership in the presence of vertical relations," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 35(5), pages 449-464, December.
    36. Auriol, Emmanuelle, 1998. "Deregulation and quality," International Journal of Industrial Organization, Elsevier, vol. 16(2), pages 169-194, March.
    37. Paul MacAVOY, 1998. "Testing for Competitiveness of Markets for Long Distance Telephone Services: Competition Finally?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 13(3), pages 295-319, June.
    38. De Fraja, Giovanni, 1993. "Productive efficiency in public and private firms," Journal of Public Economics, Elsevier, vol. 50(1), pages 15-30, January.
    39. Kay, J A & Thompson, D J, 1986. "Privatisation: A Policy in Search of a Rationale," Economic Journal, Royal Economic Society, vol. 96(381), pages 18-32, March.
    40. Gunther Tichy, 2001. "What Do We Know about Success and Failure of Mergers?," Journal of Industry, Competition and Trade, Springer, vol. 1(4), pages 347-394, December.
    41. John Vickers & George Yarrow, 1988. "Privatization: An Economic Analysis," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262720116, April.
    42. repec:ces:ifodic:v:1:y:2003:i:3:p:14567922 is not listed on IDEAS
    43. A. Michael Spence, 1975. "Monopoly, Quality, and Regulation," Bell Journal of Economics, The RAND Corporation, vol. 6(2), pages 417-429, Autumn.
    44. Sonja GRÖNBLOM & Johan WILLNER, 2008. "Privatization And Liberalization: Costs And Benefits In The Presence Of Wage‐Bargaining," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 79(1), pages 133-160, March.
    45. Florio, Massimo, 2013. "Network Industries and Social Welfare: The Experiment that Reshuffled European Utilities," OUP Catalogue, Oxford University Press, number 9780199674855.
    46. Bradburd, Ralph, 1992. "Privatization of natural monopoly public enterprises : the regulation issue," Policy Research Working Paper Series 864, The World Bank.
    47. David S Saal & David Parker, 2000. "The impact of privatization and regulation on the water and sewerage industry in England and Wales: a translog cost function model," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 21(6), pages 253-268.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Johan Willner & Sonja Gronblom, 2016. "The organisation of services of general interest in Finland," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2016(3), pages 89-116.
    2. Johan WILLNER & Sonja GRÖNBLOM, 2017. "Public Enterprises – Objectives and Performance," Departmental Working Papers 2017-03, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    3. Johan WILLNER & Sonja GRÖNBLOM, 2011. "Reforming a network industry: consequences for cost efficiency and welfare," Departmental Working Papers 2011-33, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    4. Sonja GRÖNBLOM & Johan WILLNER, 2008. "Privatization And Liberalization: Costs And Benefits In The Presence Of Wage‐Bargaining," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 79(1), pages 133-160, March.
    5. Johan Willner, 2013. "The welfare impact of a managerial oligopoly with an altruistic firm," Journal of Economics, Springer, vol. 109(2), pages 97-115, June.
    6. Johan Willner, 2010. "Public Options and Altruistic Firms - Antitrust Targets or Tools? The Welfare Impact of a Mixed Oligopoly With Managerial firms," Discussion Papers 59, Aboa Centre for Economics.
    7. Willner, Johan & Parker, David, 2002. "The Relative Performance of Public and Private Enterprise Under Conditions of Active and Passive Ownership," Centre on Regulation and Competition (CRC) Working papers 30591, University of Manchester, Institute for Development Policy and Management (IDPM).
    8. Mühlenkamp, Holger, 2013. "From state to market revisited: more empirical evidence on the efficiency of public (and privately-owned) enterprises," MPRA Paper 47570, University Library of Munich, Germany.
    9. Johan Willner, 2003. "Privatisation and Public Ownership in Finland," CESifo Working Paper Series 1012, CESifo.
    10. Holger MAHLENKAMP, 2015. "From State To Market Revisited: A Reassessment Of The Empirical Evidence On The Efficiency Of Public (And Privately-Owned) Enterprises," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 86(4), pages 535-557, December.
    11. Fischer, Justina A.V., 2012. "The choice of domestic policies in a globalized economy: Extended Version," MPRA Paper 37816, University Library of Munich, Germany.
    12. Fischer, Justina A.V., 2012. "The choice of domestic policies in a globalized economy," Papers 306, World Trade Institute.
    13. Caroline Stiel & Astrid Cullmann & Maria Nieswand, 2015. "Productivity in Electricity Retail after Market Liberalisation: Analysing the Effects of Ownership and Firm's Governance Structure," Discussion Papers of DIW Berlin 1531, DIW Berlin, German Institute for Economic Research.
    14. Johan Willner & Sonja Grönblom, 2021. "Quality provision under conditions of oligopoly," Journal of Economics, Springer, vol. 132(2), pages 103-131, March.
    15. Stiel, Caroline & Cullmann, Astrid & Nieswand, Maria, 2015. "Productivity in the Electricity Retail Market: Does Ownership Matter? A Structural Production Function Approach for Germany," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112954, Verein für Socialpolitik / German Economic Association.
    16. Caroline Stiel, 2017. "Modern Public Enterprises: Organisational Innovation and Productivity," Discussion Papers of DIW Berlin 1713, DIW Berlin, German Institute for Economic Research.
    17. Cook, Paul & Fabella, Raul V., 1997. "The Welfare and Political Economy Dimensions of Private vs State Enterprise," General Discussion Papers 30561, University of Manchester, Institute for Development Policy and Management (IDPM).
    18. Johan Willner, 2006. "A Mixed Oligopoly Where Private Firms Survive Welfare Maximisation," Journal of Industry, Competition and Trade, Springer, vol. 6(3), pages 235-251, December.
    19. Ghulam, Yaseen, 2017. "Long-run performance of an industry after broader reforms including privatization," Research in International Business and Finance, Elsevier, vol. 42(C), pages 745-768.
    20. Asaftei, Gabriel & Kumbhakar, Subal C. & Mantescu, Dorin, 2008. "Ownership, business environment and productivity change," Journal of Comparative Economics, Elsevier, vol. 36(3), pages 498-509, September.

    More about this item

    Keywords

    public ownership; privatisation; cost efficiency; social objectives;
    All these keywords.

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • H44 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Goods: Mixed Markets
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • L90 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:crc:wpaper:1520. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CIRIEC (email available below). General contact details of provider: https://edirc.repec.org/data/ciulgbe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.