PRIVATIZATION IN PUBLIC-SECTOR - MICROECO NOMIC CONCEPTS - DISCUSSION

Privatization is one of the most important issues in the transition pr ocess in our economy. Privatization of competitive industries could be mostly provided on the basis of the change of ownership form. Privati zation of noncompetitive environment is much more complex economic que stion. The public sector conditions are interconnected with the factor s of ''market failure'', redistribution, public interest as the source s of inefficiency of private economic mechanism, but at the same time with the factors of ''government failure'' as the source of the ineffi ciency of public regulations. We are not able generally to say if the private or public form wilt be more efficient under the public sector conditions. We only suggest, that the competitiveness (and nor the own ership) is the most important determinant of the efficiency. Under the se conditions each privatization decision must be based on high qualit y economic analysis of the goods produced and on the specific environm ental conditions and each is a unique one. The starting point of priva tization in public sector is producing and financing of goods by state . Under these conditions privatization in public sector could have fol lowing relevant forms (see Table 1): a) qualitative movements in start ing cluster in Table 1 (e.g. change to public financing based on econo mic indicators of performance, new public management); b) change in th e system of private production and public financing of the goods? c) c reation of ''public bodies'', as a special case. The change to private forms of ownership and financing of the goods (under ''market failure '' conditions) is a very risky measure, especially in our current stag e of development.