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Encyclopedia > Public ownership
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This article is about state ownership. For information on public corporations, see Corporation. Image File history File links Unbalanced_scales. ... Corporate redirects here. ...


Public ownership (also called government ownership, state ownership or state property) refers to government ownership of any asset, industry, or corporation at any level, national, regional or local (municipal); or, it may refer to common (full-community) non-state ownership. The process of bringing an asset into public ownership is called Nationalization or Municipalization. Ownership is the state or fact of exclusive possession or control of property, which may be an object, land/real estate, intellectual property or some other kind of property. ... In business and accounting an asset is anything owned which can produce future economic benefit, whether in possession or by right to take possession, by a person or a group acting together, e. ... Corporate redirects here. ... National governments or national unity governments are broad coalition governments consisting of all parties (or all major parties) in the legislature and are often formed during times of war or national emergency. ... Subnational entity is a generic term for an administrative region within a country — on an arbitrary level below that of the sovereign state — typically with a local government encompassing multiple municipalities, counties, or provinces with a certain degree of autonomy in a varying number of matters. ... Local governments are administrative offices of an area smaller than a state or province. ... A municipality or general-purpose district (compare with: special-purpose district) is an administrative local area generally composed of a clearly defined territory and commonly referring to a city, town, or village government. ... Please wikify (format) this article or section as suggested in the Guide to layout and the Manual of Style. ... Municipalization is the transfer to municipal ownership of corporations or other assets. ...


A government owned corporation (sometimes state-owned enterprise, SOE) may resemble a not-for-profit corporation as it may not be required to generate a profit; although governments may also use profitable entities they own to support the general budget. SOE's may or may not be expected to operate in a broadly commercial manner and may or may not have to face competitive tendering. The creation of a government-owned corporation (corporatization) from other forms of government ownership may be a precursor to privatization. A state-owned enterprise (SOE) is an enterprise, often a corporation, owned by a government. ... A Not-for-profit corporation is a corporation created by statute, government or judicial authority that does not issue stock. ... A government budget is a legal document that is often passed by the legislature, and approved by the chief executive. ... Corporatization is a form of economic reform which takes services from the direct control of the government, and places them in the control of government-owned corporations. ... Privatization (alternately denationalization or disinvestment) is the transfer of property or responsibility from the public sector (government) to the private sector (business). ...

Contents

Arguments for and against

See also: arguments for and against privatization and the welfare state Image File history File links Information_icon. ... Shortcut: WP:WIN Wikipedia is an online encyclopedia and, as a means to that end, also an online community. ... Shortcut: WP:CU Marking articles for cleanup This page is undergoing a transition to an easier-to-maintain format. ... This Manual of Style has the simple purpose of making things easy to read by following a consistent format — it is a style guide. ... Privatization (alternately denationalization or disinvestment) is the transfer of property or responsibility from the public sector (government) to the private sector (business). ... It has been suggested that Welfare capitalism be merged into this article or section. ...


For

  • Public services. Some services, such as defence, cannot be provided by the private sector directly - only a government system of taxation can finance them. Others (merit goods), such as education, can be under-provided by the private sector (according to social standards concerning access to them).
  • Essential services. In the case of an essential service - particularly one on which lives may depend - Nationalization may ensure the continuation of this service regardless of commercial or environmental pressure (saving lives is not always profitable). Furthermore, there may be externalities which mean it is in the interests of all to ensure a good service is available to everyone, even beyond moral concerns.
  • Efficiency. In natural monopolies, competition is wasteful, and will tend to be eliminated by competitive forces (leading to a private monopoly or oligopoly). A public sector monopoly can be held to account via democratically-elected governments, in a way in which a private monopoly cannot. (A private monopoly may be subject to regulation, but this may be an inefficient way of securing the public interest.)
  • Accountability. As mentioned above, while a governmental monopoly is nonetheless still a monopoly, it is answerable to the electorate rather than a small group of shareholders. (e.g. if the telephone service is nationalised, voters can bring pressure onto the government to provide better services, and parliament may have the power to sack anyone responsible for a reduction in the quality of service).
  • Consumer interests. Public ownership can protect consumer interests in sectors where competition is low, where choices are important but made infrequently, and/or where consumers do not have the expertise to make good decisions (such as in health care).
  • Common good. A profitable nationalised industry contributes with its profits directly to the common wealth of the whole country, rather than to the wealth of a subset of its population.
  • Financial security. Public sector institutions have access to finance at government interest rates, which are (almost) always lower than even the most financially secure private sector firms, because the government cannot go bankrupt, which means less risk to the lender.
  • Work ethic. Employees may be more inclined to view their work positively if it is directed by a management appointed by a government that they have a say in electing, rather than a management representing a shareholding minority. Also, they may gain intrinisc satisfaction knowing their work is important and essential for society as a whole. There has been discussion of a public service ethos which makes public sector workers work harder than they would for a private employer.
  • Equity. Public ownership can help prevent extreme imbalances of wealth.

Public services is a term usually used to mean services provided by government to its citizens, either directly (through the public sector) or by financing private provision of services. ... In military science, defense (or defence) is the art of preventing an enemy from conquering territory. ... A merit good is defined in economics as a good that is under consumed if provided by the market mechanism because individuals typically consider how the good benefits them as individuals rather than the benefits that consumption generates for others in society. ... Please wikify (format) this article or section as suggested in the Guide to layout and the Manual of Style. ... An externality occurs in economics when a decision (for example, to pollute the atmosphere) causes costs or benefits to individuals or groups other than the person making the decision. ... In economics, the term natural monopoly is used to refer to two different things. ... To meet Wikipedias quality standards, this article may require cleanup. ... In economics, a monopoly (from the Latin word monopolium - Greek language monos, one + polein, to sell) is defined as a persistent market situation where there is only one provider of a product or service. ... In economics, a monopoly (from the Latin word monopolium - Greek language monos, one + polein, to sell) is defined as a persistent market situation where there is only one provider of a product or service. ... In politics, an electorate is the group of people entitled to vote in an election. ... Health care or healthcare is the prevention, treatment, and management of illness and the preservation of mental and physical well-being through the services offered by the medical, nursing, and allied health professions. ... For other uses, see Risk (disambiguation). ...

Against

  • Waste. Government ownership may lead to waste (x-inefficiency) if it proves unable to motivate management and personnel through appropriate incentives, including appropriate pay and threat of redundancy.
  • Consumer choice. Public ownership in an industry which could be competitive in private hands may stifle innovation if proper incentives are not provided by the government. Consumer choice may be reduced and there may be no alternative sources - and no catalysts for alternative sources - of goods or services that better meet consumer preferences.
  • Misinvestment/over-investment. Public ownership of profitable services may lead to "gold-plating" (over-investment in assets) if decisions are driven by engineering ideals and not efficiency concerns.
  • Unprofitable companies survive. Public ownership of a loss-making service or industry (such as flu vaccines) may inhibit the changes needed to ensure long-term profitability (or permit bankruptcy). This may mean subsidising unnecessary losses indefinitely.
  • Misallocations of labor and money. The government may be inefficient in running production, trading, or service operations, in the sense of causing misallocations of labor and capital, with consequent reductions in the standard of living and economic growth.
  • Accountability. Accountability to the market may be eliminated, and accountability through government may be an insufficient replacement, particularly if an industry or service does not have a high public profile or if the government is not democratic.
  • Influenced by politics. Decision-making in the public sector may be prone to interference from politicians for political or populist reasons. The industry may be over-staffed in order to reduce unemployment; it may be forced to conduct transactions or actions in certain areas in order to win local votes; it may be forced to manipulate its prices in order to control inflation. Of course, some of these measures may be considered positive rather than negative, but if they are not taken properly, in the long run they are likely to be an inefficient way to meet the desired goals.
  • Source of Income Sometimes governments are accused for overcharging for products where they hold a monopoly, thus utilising them as an additional source of income, or hidden tax.

X-inefficiency is the difference between efficient behavior of firms assumed or implied by economic theory and their observed behavior in practice. ... The term management characterizes the process of and/or the personnel leading and directing all or part of an organization (often a business) through the deployment and manipulation of resources (human, capital, natural, intellectual or intangible). ... Human Resources has at least two meanings depending on context. ... In economics, an incentive in anything that provides a motive for a particular course of action — that counts as a reason for preferring one choice to the alternatives. ... Look up pay in Wiktionary, the free dictionary. ... In UK employment law, redundancy is the dismissal of an employee when his or her job becomes unnecessary. ... This article is about consumers in economics. ... Gold plating is a method of depositing a thin layer of gold on the surface of other metal, most often copper or silver, by chemical or electrochemical means. ... Capital has a number of related meanings in economics, finance and accounting. ... Politics is the process by which groups make decisions. ... Populism is a political philosophy or rhetorical style that holds that the common persons interests are oppressed or hindered by the elite in society, and that the instruments of the state need to be grasped from this self-serving elite and used for the benefit and advancement of the... An 1837 political cartoon about unemployment in the United States. ...

See also


  Results from FactBites:
 
Ownership - Wikipedia, the free encyclopedia (2335 words)
Ownership is the state or fact of exclusive possession or control of property, which may be an object, land/real estate, intellectual property or some other kind of property.
Ownership is the basis for many other concepts that form the foundations of ancient and modern societies such as money, trade, debt, bankruptcy, the criminality of theft and private vs. public property.
The basic public policy rationale for the protection of intellectual property is that IP laws facilitate and encourage disclosure of innovation into the public domain for the common good, by granting authors and inventors exclusive rights to exploit their works and invention for a limited period.
Public ownership - Wikipedia, the free encyclopedia (967 words)
Public ownership (also called government ownership or state ownership) is government ownership of any asset, industry, or corporation at any level, national, regional or local (municipal).
Public ownership can protect consumer interests in sectors where competition is low, where choices are important but made infrequently, and/or where consumers do not have the expertise to make good decisions (such as in health care).
Public ownership of profitable services may lead to "gold-plating" (over-investment in assets) if decisions are driven by engineering ideals and not efficiency concerns.
  More results at FactBites »

 
 

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