The Productivity Effects of Privatization: Longitudinal Estimates from Hungary, Romania, Russia, and Ukraine

J. David Brown, John Earle and Almos Telegdy

Journal of Political Economy, 2006, vol. 114, issue 1, 61-99

Abstract: This paper estimates the effect of privatization on multifactor productivity using comprehensive panel data on initially state-owned manufacturing firms in four economies. We exploit the data's longitudinal dimension to control for preprivatization selection and estimate long-run impacts. The estimates are robust to functional form but sensitive to selection controls. Our preferred random growth estimates imply positive multifactor productivity effects of 15 percent in Romania, 8 percent in Hungary, and 2 percent in Ukraine, but a -3 percent effect in Russia. The foreign privatization effect is larger (18–35 percent) in all countries. Positive domestic effects appear immediately in Hungary, Romania, and Ukraine and continue growing thereafter, but emerge only five years after privatization in Russia.

Date: 2006
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Working Paper: The Productivity Effects of Privatization: Longitudinal Estimates from Hungary, Romania, Russia, and Ukraine (2005)
Working Paper: The Productivity Effects of Privatization: Longitudinal Estimates from Hungary, Romania, Russia, and Ukraine (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:ucp:jpolec:v:114:y:2006:i:1:p:61-99

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