Ownership structure and efficiency: an analysis with the Theory of Incentives

Paulo Augusto P. de Britto ()

Brazilian Journal of Political Economy, 1999, vol. 19, issue 3, 460-469

Abstract: This article discusses the influence of the ownership structure over the efficiency.The framework used is the incentive theory, in which the principal must build an incentivescheme, which induces an agent to act optimally. First, we verify the reasons for publicintervention in industries with market failure. Following, we study the deterioration of theincentive structure over managers as a result of the ownership change. So, we verify how thestructure of incentives can be restored with the firm’s privatization, with the maintenance,by the government, of some control over the firm. Finally, we make a brief exposition aboutthe regulatory instruments. JEL Classification: D42; D43; D12; L13.

Keywords: Privatization; theory of incentives; principal-agent model; market failures; property (search for similar items in EconPapers)
Date: 1999
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