Studies On Economic Effects Of Privatization In Mixed Firms Of Infrastructure Sector

There are many mixed firms with state-owned part among infrastructure firms in many developing countries.Privatization is the major trend of economic development.Their products share a dual nature.On the one hand,they are final consumption for consumers.On the other hand,they are input for other manufacture enterprises.Therefore,in fact,the partial privatization of infrastructure firms is that of the industrial chain.More importantly,infrastructure goods play a significant role in the economic development.They also share a large part of cake in the whole market.However,there is few studies about this sort of topic in this field.In order to clarify the effects of mixed-ownership privatization in infrastructure sector,this paper establishes a three-sector model and consists of infrastructure mixed firm,industrial private firm and agricultural from the angle of pricing strategies between consumption and input.In other words,we analyze the effects of privatization on consumption part and input part of infrastructure production,industrial and agricultural productions,unemployment,wage,and price gap with different strategies--unified and differential pricing strategies.In terms of empirical analysis,we use the economic data of national firms in the manufacture industry from 1996 to 2014 to build log-linear model to testify the theoretical results.The reason why we study this issue from the perspective of pricing strategy is that it can not only meet the actual requirement of economic reform,but also make great contributions to related fields:we break the narrow premise that mixed firms and private firms produce homogeneous products,and incorporate the extending industrial chain of mixed firms into research structure.In other words,apart from researching the effects of privatizing mixed firms on themselves,we focus on downstream industries,general private firms.The main conclusions are:with further privatization,in the short term,unemployment increases and social welfare decreases;during the long term,unemployment decreases and industrial production increases with differentiated pricing strategy on infrastructure good.Based upon empirical analysis,we prove that further privatization reduces consuming payment so that social welfare decreases.The research in this paper provides a better understanding of the economic effects of privatization among mixed enterprises in infrastructure industry.We attempt to explain and analyze the current issues in the process of privatization,and try to help governors make the decision on whether they should use the differentiated pricing strategy.Comparing two cases,we can work on the current status and existed dilemma of privatization.We provide the solid foundation,theoretically and empirically,for evaluating situation,determining directions,and formulating practical policies.