Does public ownership affect business performance? Empirical evidence with panel data from the Spanish manufacturing sector.

This paper offers empirical evidence for the Spanish case on the hypothesis that public ownership may be a determinant of a firm's performance. Two alternative definitions of efficiency are proposed: relative productivity and profitability. The role of ownership is tested, conditioning for the degree of competition, the financial position of the firm and labour quality. The data used is a sample of Spanish manufacturing firms for the period 1983-1996. The results show that ownership is not a determinant of efficiency and that other factors, in particular, the degree of competition, seem to have a positive and significant effect on a firm's performance.