Privatization, Social Impact, and Social Safety Nets
27 Pages Posted: 13 Feb 2006
Date Written: May 1999
Abstract
Privatization promotes economic efficiency and growth, thereby reinforcing macroeconomic adjustment. In the short run, however, it can lead to job losses and wage cuts for workers and higher prices for consumers. This paper discusses these impacts and the fiscal implications of privatization. It then reviews various methods of privatization and finds that public sales and auctions can have more negative effects on workers but maximize the government`s revenue gains. Policymakers` options for mitigating the social impact of privatization are surveyed, and experiences under adjustment programs reviewed.
Keywords: Privatization, social safety nets, social welfare, state-owned enterprises, transition
JEL Classification: D60, G32, J31, L32, L33
Suggested Citation: Suggested Citation
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