Suchergebnisse

The phenomenal spread of privatization initiatives in sub‐Saharan Africa since the 1980s created the impression that public infrastructure divestiture is a shortcut to economic growth and development. This has proven not to be the case due to the lack of enabling institutional prerequisites. It appears the case that while much faith is put in the potency of the free market, little thought is generally given to the institutions required for markets to perform their function. Accordingly, this paper discusses some of the embedded institutional failures that have made free‐market development policies a mirage in many sub‐Saharan African countries. Principally among these are corruption and government failures. To check these, it makes more sense to re‐direct attention to the sources of failure rather than the free market ideological thrust.

The contextual framework or policy orthodoxy persuading the implementation of privatization was the prevalent thinking that economic systems functioned best in a "free market", with little or no government intervention. In the same vein was the belief that amore productive allocation and rationalization of factors of production will dictate a wholesale transfer from public to private sector of the ownership and control of productive assets, their allocation and pricing, including the residual profits flowing from them. The most effective vehicle for such implementation of free market privatization was adjudged to be unfettered deregulation. To the extent that it enabled the untangling of bureaucratic impediments to the inflow and retention of capital to the countries by way of foreign direct investment (FDI) and portfolio investment (PI), including the repatriation of resultant profits, it was a welcome outcome. Unfettered deregulation, as clearly manifested in recent years, particularly in well-known developed economies, appears to have produced an outcome substantially inconsistent with the traditional suppositions, begging the obvious question in the minds of academicians and policymakers alike. Where to, from here? The answer to the apparent conflict and/or contradiction is more urgent in the developing and emerging economies where privatization, and in a broader sense, the ideas and practices based on free market principles and on free market prescriptions have been promoted and sold as sacrosanct, if not necessary for their economic growth and survival. Given the current state of the global financial market which, at best, can be said to be in a state of flux, and the myriads of supposedly economic development initiatives invoking the likes of privatization and deregulation, we are tempted to ask the following questions: Are there any fixes? Could there be better, more accommodating alternative assumption(s), doctrine(s) or paradigm(s)?