Pro si contra intreprinderilor de stat

Abstract

This article has the aim to reveal the major theoretical and empirical findings relating to SOEs, with focus on the debate “for or against SOEs”. We will go through the pervasive informational asymmetries and “bounded rationality” necessitate “hierarchical” arrangements rather than “contractual” arrangements. Also discuss the Sappington-Stiglitz Fundamental Privatization Theorem which shows that the performance of private sector firms is superior to that of SOEs only under tight and often unrealistic conditions. In addition, it is important to note that the problems faced by large SOEs and large private sector firms are often very similar. They both come to face the “principal-agent problems”. When discussing the problems of SOEs, many people often implicitly assume that private sector firms are perfectly controlled by their owners, thus assuming away their agency problems. Full-scale privatization is often states as the solution recommended by supporters of today’s economy and it is only one possible way to deal with the problems of SOEs. SOE performance can be improved without any sale of shares but through organizational reform, an increase in competition, and political-administrative reforms. Undoubtedly, many SOEs are inefficient, rigid, and corrupt. However, there is no clear systematic evidence that SOEs are burdens on the economy.