Long abstract

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Although the current wave of privatisation reflects changes in economic thinking and economic policies that have been gathering force for nearly two decades, privatisation programmes are now larger and being pursued in a larger number of countries than ever before. Even in the 1980s, as policy-makers increasingly concluded that governments should emphasise a small number of 'core' activities which inherently belong to government (maintenance of public order, defence, market regulation, etc.) while leaving a greater number of decisions concerning resource allocation to the private sector, attitudes toward public ownership only changed slowly - at least within OECD countries. There were, however, two main exceptions. First, in 1979 the British government embarked on a far-reaching effort that lasted through the 1980s and during which nearly all state-owned enterprises in the competitive sector were privatised. In later stages, public utilities, and to some degree activities involving government services, were privatised. The United Kingdom by its persistent action over a decade created a framework for the planning and execution of privatisation programmes in an advanced industrial economy with well-developed capital markets, which would sever as a model for other countries at later times. Second, in 1986-87 the French government undertook a large-scale privatisation effort that was planned to last through 1991. This effort, which followed an earlier large-scale programme of nationalisation, was discontinued following the change in government in 1988.