Re: Why EO in privatization?

[umesh gala <gala@bom3.vsnl.net.in>]

Dan Bell wrote:

> Dear EOPrivers:
>
> There is a discussion going on in the ECONOMICS OF
> OWNERSHIP group which considers issues like
> which forms of ownership are better, ie, private
> concentrated, state, stakeholder, employee etc.
>
> For the EMPLOYEE OWNERSHIP IN PRIVATIZATION group,
> I would like to start from the assumption that, at
> least in some cases, we think an ownership stake
> for employees in the privatized enterprise is a
> good thing.
>
> Please answer a couple of questions:
>
> 1. Why?
>
>  Is it because we want employees to accumulate capital
>  so they are better off?
>

Certainly an ownership stake would help employees accumulate capital in
ways better than the conventional methods available to most employees.

>  Is it because we want privatization to be successful, and
>  we believe an ownership stake for employees will make
>  this happen?
>

Here again yes. Specially in a lot of developing economies privatisation
is viewed rather sarcastically by the labour. They feel privatisation is
one way of showing the exit door to the labour. By offering them a stake
a clear signal can be sent that the labour would share the fruits of
growth of the enterprise.

>  Are there any OTHER possible reasons why?
>
> 2. From each of the different perspectives of (1)
>    government, (2) employees (and their union leadership),
>    and (3) a private investor, what FACTORS SHOULD BE
>    CONSIDERED which determine whether to include or
>    NOT include employee ownership in a particular
>    privatization process?I look forward to your input!

> --
> Dan Bell
> International Program Coordinator
> Ohio Employee Ownership Center
> Kent State University
> Kent, OH 44242
> (330) 672-3028
> (330) 672-4063 fax
> dbell@kent.edu
> http://www.kent.edu/oeoc/