Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/93829
Authors: 
Crivelli, Ernesto
Staal, Klaas
Year of Publication: 
2009
Series/Report no.: 
SFB/TR 15 Discussion Paper 268
Abstract: 
We develop a theoretical model in which ?rms are either private or state-owned. When ?rms become insolvent, the government can intervene with general measures, like subsidies, or by nationalizing ?rms. The government only intervenes when the bankruptcy of a ?rm entails social costs. In a stylized model, we analyze how government interventions a?ect allocative and productive efficiency. Nationalization of private ?rms in case unpro?table investments were made, leads to increased allocative efficiency despite private ownership. The effort level chosen by the managers working for ?rms is also affected by government intervention with an impact on productive efficiency.
Subjects: 
nationalization
efficiency
JEL: 
L33
P31
P51
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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