State-Owned Enterprises and Economic Development: Concepts, Challenges, Tendencies

About

This course offers an introduction into the most important issues on state-owned enterprises (SOEs) with a special focus on their roles played in economic development. To do so, we start with the main concepts and measures of state ownership in enterprises. From a historical perspective, we discuss the tendencies of SOEs’ involvement in the economy in Europe and on the globe. Thereafter, the course addresses one of the major dilemmas of the literature: Do SOEs underperform financially compared to privately owned enterprises (POEs)? Concerning the latter, we demonstrate how the empirical evidence relates to the common assumption that SOEs operate less efficiently than POEs. Next, the course continues with the political economy of SOEs presenting the main theories of and evidence on the capture of state-owned enterprises by the domestic political elite. After discussing the main microeconomic issues on state ownership, we switch to the macroeconomic level by addressing the question how SOEs may affect economic growth. Here, special attention is devoted to the important role of government institutions in shaping the growth effects of SOEs; leading to the conclusion that state-owned enterprises are not good or bad, per se. Finally, the course ends with exploring the main determinants of the current economic weight of SOEs putting the emphasis on the deep historical and cultural roots of state ownership based on the evidence of Europe.

Course leader

Katarzyna Szarzec is an associate professor at the Poznań University of Economics and Business (Poland) and the director of the doctoral school. Ákos Dombi is an associate professor at ELTE and was visiting scholar at universities in Belin and Vienna.

Target group

BSc and MSc students, recent graduates

Course aim

- understand the main concepts and measures related to SOEs
- understand the determinants of SOEs’ financial performance
- understand the factors and the government policies which shape the growth effect of SOEs
- understand how politics may capture SOEs biasing their operation
- understand the deep roots of the differences in the current scale of SOEs
- be able to evaluate the potential benefits and the risks related to state ownership in enterprises
- contribute to development planning via deliberately designed state ownership in enterprises

Fee info