Post-privatization Period Research Articles

Does the Concept of Property Rights Hold Relevance for Human Resource Performance?

In a world where information technologies (ITs) are globalizing and acting directly and explicitly on organizations, the question of property rights neutrality becomes strategic. In this study, the authors investigated whether ownership is a determinant of human resource performance or whether it is driven by factors other than ownership (e.g., technology and IT). Thus, the major objective of this research was to find out under what conditions ownership exerts a nonneutral effect on the performance of human resources and whether these effects are dependent on the technological aspects of organizations. The authors' methodology included two techniques, namely, nonparametric tests applied to the main indicators of 21 privatized companies (operating in the IT and other sectors) in the Tunisian case, and panel data to explain the impact of privatizations on human resources. The results showed that the privatization process has allowed an improvement in productivity indicators through an increase in incentive systems, particularly for companies with high technological content. The application of the econometric technique evidenced a whole policy of restructuring the allocation of human resources, in the postprivatization period. This makes sense because the incentive system of newly privatized companies strived to be more efficient. Furthermore, the second model showed that human resource dynamics after privatization depends on the business cycle and the nature of investors and IT. The third model confirmed the idea that privatization leads to an improvement in the workforce and its productivity in the long term. Overall, the study generated important managerial implications, the most important of which is that privatization can only generate a positive effect on human resource performance when employees feel involved in the process and as much as the organization is involved in new ITs.

Evaluation of Pre and Post-privatization of Nigeria’s electric power system

The study was aimed at evaluating the performance of Nigeria’s Electric Power System before and during Privatization using Akure 33kV distribution Network as a case study. This is done to ascertain the effectiveness of the Privatization programme that occurred in the Electric Power Sector in Nigeria. The amount of energy served, the peak load supplied and load flow data of the Network for periods of 2010 to 2015 were collated from the daily log entry recording sheets of the 132/33kV transmission substation office in Akure. The percentage transformer loading and power transferred across the line were determined through load flow studies. The cost of energy not served due to faults was evaluated at a rate of NGN 24.30k per Kilo-Watt Hour (KWHr). The analysis was for a period of pre-privatization (2010-2012) and post-privatization (2013-2015). The results from the study indicate that the energy served decreased by 9% from 2010 to 2015 while the cost of energy not supplied increased largely after the Privatization. A decreasing rate in peak load supplied and transformer loadings were also observed during the Privatization. These results show that less customers might have been served or customers being served by this utility system experienced power outages more frequently in the post-privatization period than in the pre-privatization era.

Earnings Management And Privatisations: Evidence From Pakistan Evidence From Pakistan

This study examines the incidence of earnings management around the time of the privatisation of State Owned Enterprises in Pakistan during 1991-2005. Using the modified Jones model and a sample of large privatisations (minimum US$1 million), it shows that the sampled firms experienced increase in earnings, decrease in cash flows, and increase in current discretionary accruals in the year prior to and/or in the year of privatisation. The SOEs used both short term and long term accruals to inflate reported earnings. These accruals were reversed in the post-privatisation period. These findings suggest that managers of the firms slated for privatisation were engaged in earnings management to inflate their firms‘ financial worth to maximise the privatisation proceeds. Hence, we cannot reject the incidence of earnings management during privatisations in Pakistan. The results imply that the investors should carefully evaluate the to-be-privatised firms and keep in view the possibility of earnings management by the SOEs. JEL Classification: G14, G34, G38, L33, M41 Keywords: Earnings Management, Privatisations, SOEs, Pakistan, Accruals

Public Sector Enterprises (PSEs) in Post-Privatization: Evidence from Pakistan

ABSTRACT Privatization of public-sector enterprises (PSEs) has generated billions of dollars to support fiscal and macroeconomic imbalances in several developing countries. A limited literature evaluates the recent privatization program impacts on the PSEs. This study empirically investigated the privatization impact on the performance and efficiency of the firms in post-privatization period in Pakistan. Firm-level data are used to evaluate the privatization effects on performance and efficiency of the privatized PSEs. We use difference-in-difference approach that exploits within-firm variation in the outcome variables over time. The regression results show that the performance of only few firms improved while it remains negative or insignificant largely. The efficiency of the firms is also not improved significantly in post-privatization period.

Great privatization procedure: comparative and legal aspect

The article is devoted to the coverage of one of the most important problems of our time - the process of major privatization. As a result of the analysis of legislation defined that the privatization of state or municipal property - a paid alienation of property in state or municipal ownership, in favor of individuals and legal entities, and also established that the attribution of property to objects of major privatization is based on their value, which should exceed 250 million hryvnia.
 The main purpose of privatization is to accelerate economic growth, attract foreign and domestic investment, reduce the share of state or municipal property in the structure of the Ukrainian economy by selling privatization objects to the effective private owner. However, it is pointed out that the very procedure of privatization is to fill the country’s budget by transferring the share of state or municipal property in the structure of the economy of Ukraine to a more efficient private management, so the purpose enshrined in the Law requires clarification taking into account the purpose and result that is inherent in privatization.
 It is pointed out that the privatization process is carried out in accordance with a set of procedures established by the Cabinet of Ministers of Ukraine, enshrined in the decree «On Approval of the Sale of Large Objects of State Property Privatization. In addition, it is noted that to ensure effective results from the implementation of privatization requires compliance with the basic principles of privatization defined by the Organization for Economic Cooperation and Development.
 Based on the analysis of the experience of the legal basis of privatization in the UK, Spain, Poland and France, it is found that privatization in these countries is carried out by a clear regulatory consolidation of the procedure for privatization and under increased control of the relevant government agencies. It is suggested to introduce the impartial control of officials of the State Property Fund of Ukraine at each stage of privatization and control by the state over the privatized objects in a given post-privatization period.

Container Ports Post-Privatisation – Analysis of the roles of the public and private sectors at Port Botany, Sydney

The evidence base evaluating post-privatised commercial ports is virtually non-existent, especially with respect to sustainability and environmental performance. Despite acknowledged methodological limitations, a case study approach is adopted using Port Botany, Australia, as an example of a “privatised” port. In the post-privatisation period from 2013, we examine the respective roles of the public and private sectors in terms of legislation, policies and practice. How has NSW Ports responded to challenges of sustainability and environmental regulation within the port’s jurisdiction? to what extent have governments continued to be involved in planning and investment in the logistics chain to support the import and export of containers? and what are the relative costs to the private sector and the government to achieve more efficiency? The methodology involves material retrieved from websites, government and company reports, and discussions with key informants to verify the factual robustness of our findings. The findings show that the pre-privatisation environmental and regulatory framework has been effective, and that NSW Ports have been part of an Australian-wide ports initiative to implement best practice on climate change, and on economic, social and environmental sustainability countering claims in the literature that privatised ports put shareholder’s profits before the “greening” of ports. Despite Port Botany being privatised, Governments continue to enhance the efficiency of the logistical supply chain through policies and investment in transport access to the port via inland intermodal terminals.

«НАУЧНО-ПРАКТИЧЕСКИЕ ОСНОВЫ ПОВЫШЕНИЯ ЭФФЕКТИВНОСТИ ЖИВОТНОВОДСТВА В УСЛОВИЯХ ЦЕНТРАЛЬНОГО КАЗАХСТАНА»

The analysis demonstrates that the growth of animal products is provided, mainly by the private subsidiary farmings and households (PSF and HH), where is concentrated more than 80% of cattle and poultry. Meanwhile, small-scale seasonal production prevails in this sector, which, as practice shows, sometimes does not meet the requirements of the processing industry, and the output products cannot be competitive domestically, especially on the foreign markets. Consequently, the purpose of these scientific and production researches were the development of the conceptual framework for the improvement of the efficiency of live-stock animal breeding in the rural regions of Central Kazakhstan, which have lion shares of pasture land and underground minerals of the country. A distinctive feature of the operating system of the small economy management forms in rural regions of Akmola, Karaganda, North-Kazakhstani, and South-Kazakhstani areas has been studied. The modern abstract-logical, economic-mathematical and statistical methods, common research methods in the area of livestock section are applied in the scientific researches, experiments: All-Russia Research and Development Institute of Livestock Breeding, VIZH, VASKHNIL, and also data on the development of cattle breeding of the region before and post-privatization periods of the rural reform was used. On the basis of long-term research work, the author having identified the main problems, is developing a comprehensive program for the development of animal husbandry in four areas, that is, to improve systems: economy management, fodder production, subsidies and breeding. According to the research, the principles and conceptual foundations of improving the efficiency of breeding domestic farm animals have been developed. At the same time, the principles of a systematic approach, feedback, the need to describe the regulatory impacts of the state, the functional composition and structure of the system of economic models at the level of rural regions are distinguished and justified.

Estudo comparativo da rentabilidade em empresas do setor elétrico brasileiro no período pós-privatizações

O setor elétrico brasileiro passou por transformações significativas ao longo da sua história. Desde 2003, intensificaram-se as privatizações, gerando um mercado no qual as empresas públicas e privadas operam conjuntamente em um ambiente de competição. Este trabalho teve como objetivo comparar a rentabilidade das empresas públicas e privadas do setor elétrico brasileiro no período pós-privatizações, compreendido entre os anos de 2003 a 2017. Para tanto, foram coletados dados anuais de empresas de capital aberto referentes ao período temporal coberto pela pesquisa. Com o fim de estabelecer a comparação do desempenho entre as empresas privadas e públicas, empregou-se o Teste U, de Mann-Whitney. Os resultados demonstraram que, no período analisado, as empresas privadas tiveram maiores rentabilidades do que as firmas públicas, apresentando ROA, ROIC e ROE sistematicamente superiores.

The Influence of the Privatization Process on Accident Rates in the Forestry Sector in Poland.

The aim of this paper is to analyze the changes in accident rates resulting from the privatization of forest operations. Data from the years 1990–2017 were obtained from the Statistical Forestry Yearbooks issued by Statistics Poland, and were analyzed for two periods: the time of intensive privatization (1991–2002) and the post-privatization period (2003–2017). The data from 1990 were treated as a benchmark. There were 14,626 accidents in total, of which 236 (1.61%) were fatal. The non-fatal accident rate in the whole forestry industry showed a decreasing trend in the study period (t = 2.27, p < 0.05). In the case of the fatal accident rate we can observe an upward trend; in the period of intensive privatization the average annual fatality rate was 0.11, and after privatization it was 0.18 (t = −2.68, p < 0.05). In both periods the fatality rate was twice as high in the private forestry sector as in the public sector. The number of working days lost declined in the public sector and increased in the private sector. An accident in the private sector resulted in 20 days’ longer absence than one in the public sector. The study confirms that despite economic transition, accident rates in Polish forestry remain a serious issue. The main problem to be addressed is the increase in the fatal accident rate, especially in the private sector.

The impact of Economic Adjustment on the Brazilian Telecommunications Market: the mobile phone Segment

This article aims to demonstrate the results of the intervention of the State in the post-privatisation period with the implementation of the telecommunications regulatory model, specifically in the mobile phone segment. The work discusses foundamentals theory initially, highlighting the European and American schools, the basic model used in the case of Brazil. Under this perspective, the study text, analyzes and evaluates the regulation model deployed in the telecommunications market and your evolution, discussing the appropriateness of the model and your consequent efficiency in achieving the desired objectives. The considerations of this work allow to conclude that the regulatory model implanted in Brazil appeared to be effective to the extent that allowed several productivity gains and boosted economic development. Presented, however, failures caused by the intrinsic characteristics of the Brazilian market, allowing the capture of ANATEL regulatory State agent, and by subjecting technical decisions to any political interests.

From welfare to wealth creation

PurposeThe purpose of this paper is to review several influential empirical studies that examine the performance of state-owned enterprises (SOEs). The paper undertakes a citation analysis of journals, authors and titles in the area of privatization and firm performance in general, and assesses the impact of privatization on the performance of SOEs in particular.Design/methodology/approachThe methodology is based on a systematic and structured review of over 100 papers published in economics, public management, business strategy and related social sciences. The systematic review is based on citation analysis of journals, authors and titles. The journal and author citation counts were tabulated by leveraging the databases of SCImago Journal Rankings and Google Scholar and filtered it to find out the most highly cited journals and authors. The structured review is based on the framing opinion with respect to major findings, variables selected, measurement techniques and statistical tools applied by different researchers. The impact is measured through coding a value “P” in case of positive effects, “N” in case of negative effects and “NT” in case the study found both positive and negative effects.FindingsThe citation analysis reveals that American Economic Review, Journal of Financial Economics, Review of Financial Studies and Journal of Finance as the top-cited journals, and Megginson and Netter (3,468), Megginson et al. (1,737), Djankov and Murrell (1,356), Boardman and Vining (1,320), Balsam et al. (1,094) and DeWenter and Malatesta (1,018) as the top-cited authors in this particular research field. While majority research studies have revealed a significant improvement in the performance of SOEs in the post-privatization period, few studies have reserved their impact as neutral or even negative in some respects.Originality/valueGiven that economic transitions, corporate governance, and performance of SOEs have attracted a great attention from public management and business strategy scholars in recent years, this paper aims to summarize a large number of empirical studies that examine the performance of SOEs. The paper would be useful to future researchers especially the beginners and early career researchers in terms of its current trends, selection of variables, measurement techniques and statistical tools applied.

Estimation of structural organization of corporate relations at forming of corporation development strategy

The object of research in the article is the processes of interaction organization between participants in corporate relations, the combination of which is the basis for the formation of the corporate development strategy. It is proved that the model of corporate relations organization that was formed in Ukraine during mass privatization and post-privatization period has become a source of numerous obstacles to the sustainable development of domestic corporations and the establishment of effective mutually beneficial cooperation between CR participants. Based on the generalization of characteristics (general, specific, constitutive) sphere of identification of features of structural construction and activity of joint-stock companies using the methods of system analysis and formalization, the prerequisites and consequences of the manifestation of organizational construction features of corporate relations in the development strategy formation of the joint-stock company are determined. A system of indicators for assessing the structural organization of corporate relations in a joint-stock company is developed, the use of which makes it possible to ensure a comprehensive analysis of possible options for the distribution of corporate control in JSCs, taking into account the existing division of powers to make managerial decisions between the supreme governance bodies of the joint-stock company. A methodical approach is proposed to assess the structural organization of corporate relations and the distribution of corporate control in a joint-stock company. Motivational support of overcoming resistance to organizational changes in the process of implementing the development strategy of the joint-stock company is considered.

Comparison of corporate governance, strategy, control and performance e valuation systems before and after privatization

The aim of this paper is compare corporate governance and firm strategy before and after privatization. The design of control and performance evaluation systems in the pre and post-privatization periods is compared so that it can be understood in relation to the changes observed at a high corporate level (corporate governance and firm strategy). We carry out various case studies on five privatized Spanish companies. The results support several conclusions. First, the variables that are traditionally related to greater board independence in monitoring do not undergo variation after privatization. Second, the interests of the firms’ new ownership have an impact on firm strategy after privatization. Finally, control and performance evaluation system designs clearly align with firm strategy after privatization.

The bank–firm relationship during economic transition: The impacts on bank performance in emerging economies

We analyze the lending relationships between 1011 banks and 17,284 client borrowers across 11 emerging economies. We first demonstrate that a state-owned bank's risk appetite increases as its number of family business group-owned borrowing partners increases. Second, we show that a non-financial firm-owned bank's risk appetite also increases as its number of family business group-owned borrowing partners increases. Finally, we show that a bank is more likely to reduce its risk appetite and improve its operational cost efficiency as its foreign ownership ratio increases, regardless of the bank's lending partner. These findings suggest that, in the post-privatization period, the ownership structure changes of banks and/or borrowers affect the lending relationship and the bank's risk appetite and cost efficiency.

Corporate governance changes, firm strategy and compensation mechanisms in a privatization context

Purpose– The purpose of this paper is to analyze certain organizational changes that occur after privatization. More specifically, the authors analyze from an agency theory perspective how changes at the corporate governance level (ownership type/structure and board of directors) influence firm strategy, and what implications these issues have for the design of compensation mechanisms.Design/methodology/approach– The methodology employed in the study can be described as a longitudinal multiple case study approach. A multiple case study enables the comparison of pre- and post-privatization periods in five Spanish companies. This methodology is especially suitable to track the organizational changes occurring in relation to the firms’ internal management.Findings– First, the variables that traditionally relate to greater board independence in monitoring do not suffer from variation after privatization. Second, the interests of the firms’ new ownership have an impact on firm strategy after privatization. Finally, compensation system design clearly aligns with firm strategy after privatization.Research limitations/implications– The research is based on a multiple case study approach, which limits the scope and generalizability of the findings.Originality/value– Whereas research in privatization generally adopts a macroeconomic or political perspective, organizational and managerial implications are current aspects in need of further examination. This research offers a study that integrates three sets of variables (corporate governance, strategy and compensation) that have been rarely analyzed in this context.

Privatization and the economic performance of Irish Sugar/Greencore

As one of Ireland’s largest agribusiness companies, the Irish Sugar company played a key role in the country’s economic development in the twentieth century. The company was privatized in 1991 (under the new name Greencore) and has since transformed from a largely commodity-based agribusiness into an international convenience food company. This article analyses the financial and economic performance of the company in the 10 years before and after privatization. It finds that the change from public to private ownership was not strongly associated with improved financial performance and productivity as the company had experienced rapid growth and improvement in the pre-privatization period. These findings run counter to perspectives such as public choice theory that suggest a positive relationship between privatization and company performance. Performance in the post-privatization period was strongly influenced by greater exposure to market forces in the company’s expanding food division; however, it is surprising that this greater competition did not translate into improved overall performance.

Investigating Effect of Privatization on the Structure of National Iranian Copper Industries Company (NICICo)

One of the major goals of governments for improving economic conditions is to transfer the ownership of companies to the private sector. Applying Robins questionnaire, this research aimed to investigate the structure of National Iranian Copper Industries Company (NICICO) before and after privatization. The statistical population included directors of National Iranian Copper Company. Components of the company's structure were organizational centralization, formality, and complexity. Also, paired t-test was applied to analyze the data during the pre- and post-privatization periods. The results showed the significant change in the structure of NICICO before and after privatization; these changes had an incremental trend in terms of complexity and centralization; however, formality index was reduced after privatization.

Risk taking behavior of privatized banks

We examine the risk taking behavior of privatized banks prior to and after privatization and find that privatized banks experience a significant decrease in risk after privatization; however they continue to exhibit higher risk than their rivals. This finding is consistent with the assertion that following privatization and the removal of government guarantees and subsidies, privatized banks become more prudent. Since rival banks do not experience a significant change in risk taking, we attribute the reduction in risk experienced by the privatized banks to changes in the banks' ownership structure rather than to industry factors. Interestingly, we also find that a higher fraction of the privatized banks' shares sold beyond a certain intermediate level induces higher risk taking, as the privatized bank becomes more accountable to shareholders. The finding that the fraction of shares sold is positively related to risk taking, coupled with the result that the privatized banks had higher risk in the pre-privatization period than in the post-privatization period suggests a nonlinear relationship between government/private ownership of banks and risk taking. Results of further analysis are consistent with a somewhat U-shaped relationship between private ownership and risk taking. The risk taking behavior of newly privatized banks is also influenced by the country's level of development and degree of political risk. Our results are robust to different measures of risk.

Post - Privatization Performance of Jordanian Firms in Terms of Ownership Structure and Sector

The main objective of the study is to examine whether post-privatization performance changes differ according to the new ownership structure that formed after privatization. Also, the study aims at determining whether firm's performance changes during post-privatization period differ according to the sector. The empirical analysis of the study is based on a all privatized Jordanian listed companies in both industrial and service sectors during the period 1995-2006. Results of the study show that there is significant increase in operating efficiency after privatization; also, there is significant decrease in liquidity after privatization. The result of Mann Whitney test shows that there is a significant difference in post-privatization performance changes attributed to the new ownership structure. The study also shows that operating efficiency tend to be increased significantly after privatization for both service and industrial firms. Capital expenditures on the other hand, decreased significantly after privatization for industrial firms, and increased insignificantly for service firms by 6.7%. Moreover, employment level decreased for both sectors at different levels, industrial firms document statistically significant decrease in employment, while service firms document insignificant decrease in employment.

Effect of privatization on economy and its adverse effects on economy

Privatization is now become phenomenon of world, it is now practiced by most of organizations who generally wanted to achieve specific goals to flourish their economy by selling those organization creating burden on economy. Therefore in wake of many recession and certain monarchies begin to appear on world map, they have achieved different approaches on setting new targets for achieving better economic growth rate and good economic trend has become their only necessity to achieve such targets of more prosperous economy Prime assets of Pakistan were generally thrown for use of favorites and thus privatization of such economy diamond proved as a failure for economy and our economy began to move toward recession. Privatization of 63 industries including two banks named as ABL and MCB, 7 industries related with automobile category, 8 cement plants, 5 chemical plants, 1 fertilizer plant, 16 units of ghee, 14 ROTI plants and 1 textile unit. Gross Domestic growth rate was generally very much higher than 6% in 1980 after that during rapid privatization diminished to 4% in post privatization period. Most of units have been closed by its purchasers after privatization because inability and inefficiency of Pakistan privatization commission to check the purchaser’s creditworthiness. Most of units were closed soon they were privatized because government has not paid a little attention toward financial status of firm or invest who was willing to buy a company thus a large company which was contributing a little before privatization period, became idle .SCHON group has purchased national fiber, QUAID A ABAD mill and PAK china plant, therefore being bad reputation in Pakistan’s market these industries were sold to this group and consequences which had not been repaired. All three were closed after privatization. These all organization have shown a diversified effect on economy because SCHON group have not any interest in running them they generally expel their amount invested in form of privatization bidding and after gaining benefits though asset stripping they have sold the firm..L.T general(R) SAEED QADIR and SARTAAZ AZIZ generally gave a lot of explanations for unwarranted favoritism. 4.6. Privatization of profitable organization always has negative consequences on GDP Privatization is the process in which government has given the chance to other private entities to select the fate of its economy but privatizing financial institution another organization running on government expense , government has lost a million of dollars in privatization phase as it has lost its resources in form of corruption , selecting higher consultancy and privatizing those institution that are running on profits , thus whenever government has launched such practice there is always one thing in their mind is that whole amount should be disposed of at debt retirement policies and poverty alleviation techniques by education more citizens and removing inequality in income distribution. Because of such dreams government has privatized it’s all those organization which were giving more double return in form of loans whenever they borrowed from state bank. These firms were also giving larger profits and double taxes to the government than pre-nationalization tenure. Thus privatizing such institution not only mean to get our employees ready for sitting at home idle but also reduction in revenues that government used to get for other fruitful activities , now all that amount would go in barrels of foreign direct investors , and we soon realized the current of swimming against current