Corporatization and Firm Performance: Evidence from Publicly-Provided Local Utilities
This study investigates the effects of the corporatization process – i.e., the transformation of a municipal firm into a limited liability company – on the production costs of local public services whose ownership is maintained by the local government. Theoretical analysis predicts that, even without privatization, corporatization is a potentially effective way to improve efficiency (Shleifer and Vishny, 1994; Stiglitz, 2000). We explore this issue by using information on a typical local utility, such as the bus service provided by public transit systems in Italy, which experienced a reform of the governance towards the corporatization structure during the ’90s. The results on a sample of 33 local bus companies over the period 1993-2002 show that, even if public ownership persists, the transformation of a municipal enterprise into an autonomous company – corresponding to the first stage of the corporatization of local utilities in Italy – or into a limited liability company exerts a reducing impact on production costs.
Year of publication: |
2011
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Authors: | Carlo, Cambini ; Massimo, Filippini ; Massimiliano, Piacenza ; Davide, Vannoni |
Published in: |
Review of Law & Economics. - De Gruyter, ISSN 1555-5879. - Vol. 7.2011, 1, p. 191-213
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Publisher: |
De Gruyter |
Saved in:
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