Abstract
This paper presents a comparative analysis of productivity and profitability of companies of the private and public sector from selected countries of Central and Eastern Europe (CEE). The research is based on the data of productivity and profitability from 'Cranet' project. The results of analysis indicate a statistically significant difference in the level of productivity and profitability between these two sectors, so that private sector has significantly higher level of productivity and profitability than the public sector companies. Analysis according to the individual countries also points to a significantly higher level of productivity and profitability in the private sector, except in Slovenia where the public sector companies have a better level only of productivity compared to the private sector.
Highlights
This paper presents a comparative analysis of productivity and profitability of companies of the private and public sector from selected countries of Central and Eastern Europe (CEE)
The main objective of this paper is to examine whether there is a significant difference in the level of productivity and profitability between companies from the private and public sectors
The research of the business performances is based on data collected in countries of the CEE region: Slovakia, Bulgaria, Hungary, Slovenia, and Serbia, with total of 677 enterprises divided in two groups according the ownership: enterprises from the private and public sector
Summary
Market competition is characterized by the competition on the supply side between organizations from the private and public sector. The main goal of an enterprise from the private sector is a long-term business success and profit, i.e. earnings for shareholders. In the long-term, companies of every sector can be successful only if they achieve efficient and effective business, which is measured by the ratio of output and input and by the level of achievement of set business goals (Andrašić, 2012). One of the main reasons for privatization programs in countries of Europe was the belief that the private enterprises are doing business in a more efficient way than public sector enterprises. This belief was confirmed by numerous empirical studies. The main objective of this paper is to examine whether there is a significant difference in the level of productivity and profitability between companies from the private and public sectors
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