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Report

Published:

The Inferior Performance of State Owned Enterprises: Is it due to Ownership of Market Structure?

Written by

Leo A. Grünfeld
Gabriel R G Benito
Eskil le Bruyn Goldeng

Ed.

Åsmund Weltzien
Head of Communications

Summary:

We analyze differences in performance between private companies (PCs) and state owned enterprises (SOEs), with an emphasis on the effects of market structure. We use a panel covering all registered companies during the 1990s in Norway, a country where SOEs play an important role in regular markets. Return on assets as well as costs measures are used as measures of performance in models that investigate markets where SOEs and PCs actually compete with each other. Although market shares and concentration affect performance, ownership identity still explains most of the inferior performance among SOEs.

Written by

Leo A. Grünfeld
Gabriel R G Benito
Eskil le Bruyn Goldeng