Finland’s state-enterprise sector has been larger than in most countries and included several manufacturing companies. These were usually established because of a scarcity of private venture capital, with a mission to contribute to industrialisation. Some companies have now been privatised in a process that has been fairly successful in its stated aims of generating revenues and achieving industrial restructuring. But the state-owned companies have also been fairly successful, so there is no evidence of improved financial performance or cost efficiency despite stronger focus on profits. Costs have on the other hand often been reduced in traditional public-sector industries, where private provision has increased with deregulation and/or competitive tendering and more commercial objectives. The consequences for allocative efficiency are however ambiguous, because of changes in quality and working conditions.
