Privatisation Essay

831 Words2 Pages
bulb-icon

Recommended: Negative effects of consumerism

The third reason for privatisation was to develop resourcefully working markets. Welfare economics (Ofcom, 2011) argues that efficiency is achieved during a competitive market, so if competition is promoted then privatisation can be vital to efficiency effects. "Liberalisation and deregulation should be possible in order to have an efficient private sector and the cause for this is due to the initially nationalised enterprises are frequently monopolies," (Affuso, 2009, p. 222). So one can assume that some nationally governed monopolies were privatised and turned into private monopolies such as water, gas, utilities and railways.
Furthermore, the prospect of deregulation and liberalization can possibly continue independent of the private sector. “For example, there could be a level of liberalisation if limitations on imports are lifted and regulations are removed that had previously delayed competition,” (Boardman, 2013, p. 30). Which ties in very well with the citation in the introduction by Robinson (2006) that points out that if an item or assets is owned by everyone, then it is really owned by no-one.
Forth reason is that politicisation existed where there was corporate managers. Government will be responsible for those enterprises which leads to lasting political influence over the corporation`s management, therefore, lobbying is a constrain for efficiency maximisation.
Let's examine the privatisation carried out by the British Conservative governments. When reviewed (Holder, 2012) it will show that it worked out to be a good example of interaction among pressure groups and government, with little regard for the consumers' interest. This definitely proves that political objectives are likely going to lead government acti...

... middle of paper ...

...lection. The industry regulatory bodies had established the Mergers Commission to bring forward the task of liberalisation. In addition to privatisation schemes there will always be a domination by political objectives which is usually carried out by governments. It is clear that a move from public ownership, which has some drawbacks ,to private ownership is potentially incredibly beneficial to consumers. Hard to believe! On the other hand, in order to ensure that these expansions are realised, market liberalisation is essential as a complementary policy. Even if privatisation wasn't accompanied by initial liberalisation, then in the long run it may possibly result in the appearance of a competitive market if there aren't barriers. However I believe that politics seems to be more important than the economics and especially does not include the consumer`s well being.

Show More
Related

  • Monopolies In The Gilded Age

    1325 Words  | 3 Pages

    Unfortunately, these monopolies allowed companies to raise prices without consequence, as there was no other source of product for consumers to buy for cheaper. The more competition, the more a company is forced to appeal to the consumer, but monopolies allowed corporations to treat consumers awfully and still receive their business. Trusts were bad for both the consumers and the workers, but without proper representation, they could do nothing. However, with petitions, citizens got the first anti-trust law passed by the not entirely corrupt Congress, called the Sherman Act of 1890. It prevented companies from trade cooperation of any kind, whether good or bad. Most corporate lawyers were able to find loopholes in the law, and it was largely ineffective. Over time, the Sherman Anti-Trust Act of 1890, and the previously passed Interstate Commerce Act of 1887, which regulated railroad rates, grew more slightly effective, but it would take more to cripple powerful

    Read More

  • Contrasting Friedman and Lindblom on Economic Systems

    1124 Words  | 3 Pages

    The current issues that have been created by the market have trapped our political system in a never-ending cycle that has no solution but remains salient. There is constant argument as to the right way to handle the market, the appropriate regulatory measures, and what steps should be taken to protect those that fail to be competitive in the market. As the ideological spectrum splits on the issue and refuses to come to a meaningful compromise, it gets trapped in the policy cycle and in turn traps the cycle. Other issues fail to be handled as officials drag the market into every issue area and forum as a tool to direct and control the discussion. Charles Lindblom sees this as an issue that any society that allows the market to control government will face from the outset of his work.

    Read More

  • Monopolies In Canada Case Study

    855 Words  | 2 Pages

    I believe that we have too many monopolies in Canada because monopolies give the consumer less choice, lower quality service, and products and services can be more costly to the consumer. In my opinion, a market-based economy with fewer monopolies will benefit the consumer because companies will compete to give you the best deal possible to retain your business. In this environment the consumer will benefit most as a consumer, I

    Read More

  • The Effects of the American Industrial Revolution Described in "A People’s History of the United States", "America: A Narrative History" and "A Histor

    1169 Words  | 3 Pages

    ...tually break up monopolies when they formed, by specific legislation” (600). They see that the government is letting the business tycoons to own whatever land they want and extend their fortunes. Unlike the first two books, Johnson’s book discussed the history of the book without bias and from a different perception; one that was not came from an American view.

    Read More

  • Standard Oil Company Case Study

    715 Words  | 2 Pages

    First the story of the Standard Oil Company briefly describes the limits of power. When Rockefeller was trying to take over the market he formed the “South Improvement Plan. When this occurred the public grew very angry with the price of trains, so nobody went on the railroads and Rockefeller eventually got the bill, until prices changed. This is an example of how the consumers, make the company run and when nobody wants to buy your product the individual must adjust. Another example would be when the Standard Oil Company was primarily the only oil company and was forced to split into thirty nine different independent companies. This shows that one business cannot control the entire market and interventions will need to be done accordingly so that a company does not have all the power.

    Read More

  • Essay On Monopoly

    735 Words  | 2 Pages

    We all hear the term “monopoly” before. If somebody doesn't apprehend a monopoly is outlined as “The exclusive possession or management of the provision or change a artifact or service.” but a natural monopoly could be a little totally different in which means from its counterpart. during this paper we'll be wanting into the question: whether or not the govt. ought to read telephones, cable, or broadcasting as natural monopolies or not; and may they be regulated or not?

    Read More

  • Examples Of A Good Monopoly

    1033 Words  | 3 Pages

    There is much controversy about what a ‘good’ monopoly is and what a ‘bad’ monopoly is. Monopolies can have a positive impact on the market. One example is the history of telecommunications. The American Telephone and Telegraph “consolidate(d) the industry by buying up all the small operators and creating a single network—a natural monopoly” (Taplin). It became easier and more convenient for consumers to communicate. This is an example of a ‘good’ monopoly. Louis Brandeis, counselor of President Woodrow Wilson, agreed. He said it makes sense for one or a few companies to own‘“natural” monopolies, like telephone, water and power companies and railroads” (Taplin). The keyword here: natural monopolies. Natural monopolies are different from most of the monopolies in the market place today. A natural monopoly “refers to the cost structure of a firm” (lpx-group). A monopoly is “associated with market power and market share in particular” (lpx-group). Natural monopolies make

    Read More

  • Essay On Social Care And Privatisation

    1836 Words  | 4 Pages

    2008, p. 144); in other words, the privatisation is a policy run and controlled by the government, this privatisation movement was based on human rights, control of prices and the regulations of the health services and social care in order to promote better outcomes and better standards of care.

    Read More

  • France After the Cold War

    758 Words  | 2 Pages

    France has very diverse economic sectors. Big enterprises are partially or completely privatized by the government. Such companies include Thales, Air France, Renault and France Telecom. There are other sectors in which the government retains a strong presence, such as public transport, defense and power. The french leaders of the country are persistent in committing to a free market in which they retain social equity through tax policie...

    Read More

  • An Analysis of the Populist and Progressive Era

    1671 Words  | 4 Pages

    During the nineteenth and twentieth century monopolizing corporations reigned over territories, natural resources, and material goods. They dominated banks, railroads, factories, mills, steel, and politics. With companies and industrial giants like Andrew Carnegies’ Steel Company, John D. Rockefeller’s Standard Oil Company and J.P. Morgan in which he reigned over banks and financing. Carnegie and Rockefeller both used vertical integration meaning they owned everything from the natural resources (mines/oil rigs), transportation of those goods (railroads), making of those goods (factories/mills), and the selling of those goods (stores). This ultimately led to monopolizing of corporations. Although provided vast amount of jobs and goods, also provided ba...

    Read More

  • Standard Oil Monopoly Analysis

    450 Words  | 1 Pages

    A monopoly is detrimental to any society. When one business is the sole provider of a good or service, that gives that company incredible power. They can charge anything they want, and if it’s a product that the public really needs, the public is at that company’s mercy and must pay. A monopoly is also bad because of the tactics used to create it in the first place. Often times, dirty tricks are employed to drive competitors out of business, ruining lives in the process. A company like Standard Oil had deep pockets, so it could afford to slash it’s prices to rock bottom in order to bankrupt a competitor. Big companies like that also have a lot of political influence and this is never a good thing for the environment or society. John Sherman, who was the sponsor of the Sherman Antitrust Act wrote: "if we will not endure a king as a political power, we should not endure a king over the production, transportation and sale of any of the necessaries of life.’” The United States doesn’t tolerate monarchies or monopolies very well at

    Read More

  • The Athenian Democracy Compared to Today's Democracy

    1895 Words  | 4 Pages

    ...k for big business, a private individual, or even the public. The goals and strategies are the same for all lobbyist. Foremost, they must be very good at the art of persuasion, the mainstay of their job. They figure out how to sway politicians to vote on legislation in a way that favors the interest they represent. In our American democracy, people that are not elected representatives shape the laws of our country. If we continue down this path, our democracy will also one day be extinct. We need to get back to the roots of democracy and remember what the true meaning is. Power to the People!

    Read More

  • Corporations And Social Problems Essay

    1062 Words  | 3 Pages

    Corporations have far more power than most Americans know of. Large and powerful corporations dominate the American economy. Corporations have a lot of power and influence in the government, it’s possible that they have more influence than government. With so much power and control, corporations are involved with many factors of everyday life. Corporations are involved in food, jobs, water and even our healthcare system. With so much power and control comes problems. Corporations cause major issues in all of these areas.

    Read More

  • Public Administration And Public Choice Essay

    1450 Words  | 3 Pages

    Persons studying public choice do not consider that government officials are in fact concerned with public interests. The dispute here is that these administrators function in an environment which replicates poor communication on current political issues or just do not care to address these issues. Administrators do not focus on public choice since their main objective is policy making process. It is certain in all societies that there will be self-interest in all aspects of public policy making. For example, government officials will prepare a country’s budget based on their own self-interest and how they can be benefitted mostly.

    Read More

  • Monopoly Essay

    926 Words  | 2 Pages

    2. Provide an example of a government-created monopoly. Is it a bad public policy? Why?

    Read More

More about Privatisation Essay

Open Document