The British Approach to Privatisation
10 Pages Posted: 13 Jun 2014
Date Written: June 2014
Thirty or so years after the 1945–51 Labour government nationalised the ‘commanding heights’ of the British economy, these enterprises were collectively losing the equivalent of £2 billion annually in today's money. In 1979 a Conservative government embarked on a programme of privatisation which handed out hefty inducements to managers, employees and investors and yielded total net proceeds of nearly £70 billion over 18 years. The introduction of competition (as well as regulation) reduced overstaffing and strike threats in state‐run industries and eliminated most of the losses.
Keywords: competition, politics, privatisation, regulation, statutory monopoly
JEL Classification: L33, L43, L51
Suggested Citation: Suggested Citation