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In general, nationalization was common during the immediate post- World War 2 period, but privatization became a more dominant economic trend (especially within the United States and the United Kingdom) during the 1980s and '90s. This trend of privatization has often been characterized as part of a "global wave" of neoliberal policies, and some observers argue that this was greatly influenced by the policies of Reagan and ThatcherMargaret Hilda Thatcher, Baroness Thatcher LG, OM, PC, FRS (born October 13, 1925) is a British politician and the first woman Prime Minister of the United Kingdom, a position she held from 1979 to 1990. She is a member of the Conservative Party and still. The term "privatization" was coinedWords and phrases are often created, or coined " by combining existing words, or by giving words new and unique suffixes and/or prefixes. For example, the word "video" had been used to describe any visual image on a television screen, and "tape" to descri in 19481948 is a leap year starting on Thursday (link will take you to calendar). Events January January 1 Nationalisation of UK railways to form British Railways. Arab militants lay siege to the Jewish Quarter of the Old City of Jerusalem. First day of the Ital and is thought to have been popularized by The EconomistFebruary 21 2004 The Economist is a weekly news and international affairs publication of The Economist Newspaper Limited in London. Subjects typically covered include international politics, business, finance, science and technology and the arts. The publ during the '80s. Perhaps the most discussed privatization case has been the Privatization of British railways.
Privatization is frequently associated with industrial or service-oriented enterprises, such as mining, manufacturing or power generation, but it can also apply to any asset, such as land, roads, or even rights to waterDrinking water This article focuses on water as we experience it every day. The water (molecule) article describes water from a scientific and technical perspective. Water is an abundant substance on Earth. It exists in many forms, such as sea, rain, and. In recent years, government services such as health, sanitation, and education have been particularly targeted for privatization in many countries.
The basic argument given for privatization is that governments have few incentives to ensure that the enterprises they own are well run. On the other hand, private owners, it is said, do have such an incentive: they will lose money if businesses are poorly run. The theory holds that, not only will the enterprise's clients see benefits, but as the privatized enterprise becomes more efficient, the whole economy will benefit. Ideally, privatization propels the establishment of social, organizational and legal infrastructures and institutions that are essential for an effective market economyA market economy is an economy in which most allocations of resources occur as a result of interactions between buyers and sellers of goods and services. It is often contrasted with a planned economy in which most allocations of resources occur as a resul.
Advocates of privatization argue that governments run businesses poorly for the following reasons:
In particular, the first and last reasons are held to be the most important because money is a scarce resource: if government-run companies are losing money, or if they are not as profitable as possible, this money is unavailable to other, more efficient firms. Thus, the efficient firms will have a harder time finding capital, which makes it difficult for them to raise production and create more employment.
Another argument for privatization is, that to privatize a company which was non-profitable (or even generated severe losses) when state-owned means taking the burden of financing it off the shoulders and pockets of taxpayers, as well as free some national budget resources which may be subsequently used for something else. Especially, proponents of the laissez-faire capitalism will argue, that it is both unethical and inneficient for the state to force taxpayers to fund the business that can't work for itself. Also, they hold that even if the privatized company happens to be worse off, it is due to the normal market process of penalizing businesses that fail to cope with the market reality or that simply are not preferred by the customers.
Furthermore, it is argued that an unprofitable public company may become profitable in private hands. An example cited by proponents is Deutsche Post, once part of the German postal service, which began generating profits after it became a part of the international corporation TNT Worldwide Express .
Many privatization plans are organized as auctions where bidders compete to offer the state the highest price, creating monetary income that can be used by the state.
The state can also allow foreigners to buy privatized enterprises, which allows an outside investor to supply the capital needed to upgrade and modernize the firm. Many Polish companies were sold to outside investors, among them the Kwidzyn paper factory, which became a successful firm after its purchase by International Paper.