Full text: The Economics of Transition.

6 
example for both the positive and the negative aspect of the 
matter. 
There is of course also another difference between state and 
private concerns which is of great practical importance. The state 
concern is subject to the interference of politics, especially in 
its selection of management and personel and politics in a 
democracy means of course party politics. It must be admitted that 
this speaks against the state run industry in the period of 
transition but the argument must be weighed against the 
probability that the same element of party politics may play also 
a dangerous role in the process of privatisation. 
Where the state owned concern does not happen to have the legal 
form of a corporation there is also a subsidiary difference from 
the private concern in so far as it is not liable to public 
accounting. This is of limited but perhaps not entirely negligible 
importance. 
It may be concluded that national concerns may in principle be 
subjected to controls similar to those imposed on private firms 
(especially by the banks) provided the government is capable and 
willing to exercise sufficient control based on monitoring and 
long term industrial policy and technology assessment. 
* 
Wwhat is the relevance of these considerations to the questions of 
the transition period? It so happens that the question whether the 
old sector should be privatised forthwith can be answered more 
simply, at least for the time being, without appealing to the 
larger questions of private or public property. It is apparently - 
and not surprisingly - very difficult to find buyers for these 
industrial concerns. It would be a wanton and irresponsible policy 
to throw these assets away at any price the more so that
	        

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