What is privatization what are its merits and limitations?
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Privatization is the process of transferring ownership of a business enterprise, agency or public service or property from the public sector to Private sector or to non-profit organisation.
Merits-
1- Improves efficiency.
2- Lack of political interference.
3- Short term view.
4- Shareholders.
5- Increase competetion.
6- Govt. will raise revenue from the sale.
Limitations
1- Natural monopoly.
2- Public interest.
3- Govts. losses out on potential dividens.
4- Problems of regulating private monopolies.
5-Fragmentation of industries.
6- Short termisms of firms.
Merits-
1- Improves efficiency.
2- Lack of political interference.
3- Short term view.
4- Shareholders.
5- Increase competetion.
6- Govt. will raise revenue from the sale.
Limitations
1- Natural monopoly.
2- Public interest.
3- Govts. losses out on potential dividens.
4- Problems of regulating private monopolies.
5-Fragmentation of industries.
6- Short termisms of firms.
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