State-owned Enterprises In A Mixed Economy

A distinctive feature of economic trends of the past three decades has been the increase in microeconomic intervention by state-owned enterprises (SOEs) in the market economies of rich industrial and poor developing nations. The majority of SOEs were established as policy instruments of choice in response to a variety of socioeconomic needs and socio-political problems. As persuasively demonstrated in this book microeconomic efficiency criteria alone stemming from the theory of a perfectly competitive economy are badly designed criteria for public firms. The historical part of the book in particular discusses quite compellingly a number of causes other than market failures for the existence of state-owned enterprises. This discussion develops complex answers regarding causes for the existence of public firms.