All The Alleged Key Causes Of Soe [state-owned Enterprise] Inefficiency - The Principal-agent Problem, The Free-rider Problem And The Soft Budget Constraint - Are, While Real, Not Unique To State-owned Enterprises. Large Private-sector Firms With Dispersed Ownership Also Suffer From The Principal-agent Problem And The Free-rider Problem. So, In These Two Areas, Forms Of Ownership Do Matter, But The Critical Divide Is Not Between State And Private Ownership - It Is Between Concentrated And Dispersed Ownerships.

-Ha-Joon Chang

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All The Alleged Key Causes Of Soe

Ha-Joon Chang

All The Alleged Key Causes Of Soe [state-owned Enterprise] Inefficiency - The Principal-agent Problem, The Free-rider Problem And The Soft Budget Constraint - Are, While Real, Not Unique To State-owned Enterprises. Large Private-sector Firms With Dispersed Ownership Also Suffer From The Principal-agent Problem And The Free-rider Problem. So, In These Two Areas, Forms Of Ownership Do Matter, But The Critical Divide Is Not Between State And Private Ownership - It Is Between Concentrated And Dispersed Ownerships.

Topic

Real

Unique

Keys

The Widely Accepted Assertion That, Only If You Let Markets Be Will Everyone Be Paid Correctly And Thus Fairly, According To His Worth, Is A Myth. Only When We Part With This Myth And Grasp The Political Nature Of The Market And The Collective Nature Of Individual Productivity Will We Be Able To Build A More Just Society In Which Historical Legacies And Collective Actions, And Not Just Individual Talents And Efforts, Are Properly Taken Into Account In Deciding How To Reward People.

Taken

People

Effort