Privatization methods and productivity effects in Romanian industrial enterprises

TitlePrivatization methods and productivity effects in Romanian industrial enterprises
Publication TypeJournal Article
AuthorsEarle, J. S., and A. Telegdy
Journal titleJournal of Comparative Economics
Pages657 - 682

Comprehensive panel data on privatization transactions and labor productivity in Romanian industrial corporations are used to describe the postprivatization ownership structure and to estimate the effect of Romania's diverse privatization policies on firm performance. The econometric results show consistently positive, highly significant effects of private ownership on labor productivity growth; the point estimates imply an increased 1.0 to 1.7% growth for a 10% rise in private shareholding. The strongest estimated impacts are associated with sales to outside blockholders; insider transfers and mass privatization are estimated to have significantly smaller, although still positive, effects on firm performance.


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Department of Economics and Business