This title is the first in the Critical Perspectives on the World Economy series. With a new introduction by the editors it brings together the most significant contributions on privatization including material on the philosophical and historical context.
Specific subjects covered include:
* regulation and competition policy
* different forms and techniques of privatization
* the impact of privatization.
Drawing on an enormous range of sources, the collection includes material by Hayek, Harold Demsetz, Douglass North, Janos Kornai, Jean Tirole and Jeffrey Sachs. It is an indispensible reference for policy makers, as well as academics concerned with economic policy and public economics.

The book is divided into three major sections. The first presents a theoretical discussion that underlies the other essays. The second section deals with privatization issues from the perspective of the United States. The third describes research addressed to the U. K. and Canada. In the first chapter, Richard Zeckbauser and Murray Horn develop a wide-ranging theoretical framework for assessing the capabilities and role of state-owned enterprises; it provides a foundation for the analyses that follow. In The Control and Perfonnance o[ State-Owned Enterprises , they describe state-owned enterprises as an extreme case of the separation of ownership and control. The focus is on management --the incentives it faces and the conflicts to which it is subjected. The distinguishing characteristics of public enterprise, the authors suggest, give it a comparative advantage over both public bureaucracy and private enterprise in certain situations. They argue that legislators are more likely to prefer SOEs over private enterprise when the efficiency of private enterprise is undermined by regulation or the tbreat of opportunistic state action, when the informational demands of subsidizing private production to meet distributional objectives are high, when it is difficult to assign property rights, or when state ownership is ideologically appealing. These considerations suggest why SOEs are usually assigned special rights and responsibilities, and they help explain observed regularities in the distribution of SOEs across countries and sectors. Zeckhauser and Horn apply principal-agent theory to identify the key factors underlying the performance of state-owned enterprises.

Competition in network industries faces particular problems which are analyzed from both a theoretical and policy perspective. Issues of vertical integration, deregulation and privatization are covered. While competition and privatization are rapidly unfolding in telecommunications in Western and Eastern Europe, energy and railway transportation represent sectors of more gradual liberalization. The different market characteristics of telecommunications, energy and transportation raise consistency problems in the fields of deregulation, investment strategies and internationalization. While transformation policies create opportunities for liberalization in Eastern Europe and Russia the latter shows critical problems in ending monopoly and state ownership. Network industries could be subject to competition and promise major investment opportunities plus consumer benefits.

Paul J. J. Welfens and George Yarrow A. Telecommunications in Western Europe: Liberalization, Technological Dynamics and Regulatory Developments 9 Paul J. J. Welfens and Cornelius Graack 1. Introduction 9 2. Liberalization and Market Expansion in Telecommunications 12 2. 1 Global Forces in Telecoms Liberalization 19 2. 2 Privatization and Deregulation in Western Europe 22 2. 3 Politico-economic Deregulation Pressures 26 3. Technological Dynamics 30 3. 1 Digitization 31 3. 2 Integrated Services Digital Network 33 3. 3 Fibre Optics, Fibre to the Home and Optical Networks 35 3. 4 Mobile Communications 38 4. Regulatory Developments 40 4. 1 Regulatory Developments on the EC Level 41 4. 2 National Regulatory Frameworks: Developments and Experiences 46 4. 2. 1 Telecommunications Equipment 47 4. 2. 2 Value-added Services 49 4. 2. 3 Infrastructure 52 5. Prospects and Consequences for Central and Eastern Europe 72 Appendix 78 B. Telecommunications in Systemic Transformation: Theoretical Issues and Policy Options 85 Paul J. J. Welfens 1. Introduction 85 2. Points of Departure in Eastern Europe 90 2. 1 Structure of the Telecoms Industry in an East-West Perspective 94 2. 2 Telecoms Industry as a Strategic Industry for Systemic Transition 97 VI Telecommunications and Energy in Systemic Transformation 3. Theoretical Aspects of the Telecoms Industry 99 3. 1 Some Problems of Uniform Subscriber Pricing 99 3. 2 Competition, Natural Monopoly and Economies of Scope 102 3. 3 External Effects of Telecoms Network Expansion 109 3.