Credible Commitment and Success with Public Enterprise Reform

Posted: 11 Jan 2000

See all articles by Hadi Salehi Esfahani

Hadi Salehi Esfahani

University of Illinois at Urbana-Champaign

José Edgardo Campos

Asian Development Bank

Multiple version iconThere are 2 versions of this paper

Date Written: June 1999

Abstract

This paper studies why some efforts at public enterprise reform fail and why others succeed. Economic reforms are intended to increase efficiency and, thus, help sustain long term growth. Yet, many governments have had difficulty sustaining the reforms they initiated and have reintroduced rigid controls over markets and enterprises. This is because either in the process of implementation, the government discovers that the costs of carrying the reform further are greater than the expected efficiency gains, or the public is skeptical that the new policies can be sustained and does not take the actions necessary for the gains to be realized. This paper develops a new-institutionalist framework and employs various measures of policy commitment and net gain from continued reform to analyze these issues. The paper suggests ways in which the potential success or failure of a reform can be assessed, with implications for the steps that reformers might take to increase the chances of success.

JEL Classification: L32, L33

Suggested Citation

Esfahani, Hadi Salehi and Campos, José Edgardo, Credible Commitment and Success with Public Enterprise Reform (June 1999). Available at SSRN: https://ssrn.com/abstract=195228

Hadi Salehi Esfahani (Contact Author)

University of Illinois at Urbana-Champaign ( email )

Department of Economics
1206 South Sixth Street, 210DKH
Champaign, IL 61820
United States
217-333-2681 (Phone)
217-333-1398 (Fax)

José Edgardo Campos

Asian Development Bank ( email )

6 ADB Avenue, Mandaluyong City 1550
Metro Manila
Philippines

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