and
Fabrizio Erbetta
(Ceris-Cnr)
March 1999
Abstract
This work aims at investigating the changes in technical efficiency following the
privatization of 39 Italian medium-sized firms operating in competitive sectors. Using
Data Envelopment Analysis over a period of 10 years we highlight that, apart from
acquisitions by foreign groups, there have not been significant changes in the levels of
total efficiency.
The only statistically significant change concerns the strong recovery in labour
productivity that showed to be continuous even during the period undergoing public
control. The results, in contrast with the main theoretical predictions, shift attention
to the Italian financial market. A weak incentive system and the low competition in the
access to the market for corporate control seem to be the main explanatory variables.
JEL classification: L33, C61
Key words: Privatization, DEA, Efficiency
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