Does Privatization Raise Productivity? Evidence from Comprehensive Panel Data on Manufacturing Firms in Hungary, Romania, Russia and Ukraine |
![]() |
![]() |
![]() |
J. David Brown, John S. Earle, and Almos Telegdy Does Privatization Raise Productivity? Evidence from Comprehensive Panel Data on Manufacturing Firms in Hungary, Romania, Russia and Ukraine June 6, 2005 Abstract This paper analyzes the impact of privatization on multifactor productivity (MFP) using long panel data for nearly the universe of initially state-owned manufacturing firms in four economies. Controlling for firm and industry-year fixed effects and employing a wide variety of measurement approaches, majority privatization raises MFP about 28% in Romania, 22% in Hungary, and 3% in Ukraine, with some variation across specifications, while in Russia it lowers it about 4%. Privatization to foreign rather than domestic investors has a larger impact (about 44%) and is much more consistent across countries. The positive effects emerge within a year in Hungary, Romania, and Ukraine and continue to grow thereafter, but are still ambiguous even after 5 years in Russia. Pre-privatization MFP exceeds that of firms remaining state-owned in all countries, implying that cross-sectional estimates overstate privatization effects. The patterns of the estimated effects cast doubt on a number of explanations for "when privatization works." |
National Council for Eurasian and East European Research (NCEEER) is a non-profit organization created in 1978 to develop and sustain long-term, high-quality programs for post-doctoral research on the social, political, economic, environmental, and historical development of Eurasia and Central and Eastern Europe. More
Doctors' and Parents' Perspectives on Communication Regarding HPV Vaccination in Bulgaria
Elitsa Dimitrova, Yulia Panayotova, Anna Alexandrova-Karamanova, and Irina Todorova
Contextual Constitution of Behavior: Introducing the HPV Vaccine in Eastern Europe
Irina Todorova and Adrian Baban
The Readers of Novyi Mir, 1948-1969: A Social Portrait
Denis Kozlov