State Enterprises after Privatization

Many authors compared the relative efficiency of public andprivate enterprises, but taken as a whole the literatureremains inconclusive, both conceptually and empirically. Theanalysis of what happened to former state enterprises afterprivatization has helped to untangle this issue and overcomemethodological difficulties identified in previous studies.This paper adds to this recent literature by examining theimpact of privatization on the performance of stateenterprise sold in 1981 - 94 in Brazil. Statisticallysignificant results were obtained showing a clearimprovement in performance after privatization. Thisimprovement proved to be more significant, in economic andstatistical terms, for sales of controlling stakes and forthe companies privatized in 1991 - 94