Definition
It may include selling state-owned enterprises, contracting services, or allowing private competition.
Political Dictionary
Privatization
Privatization transfers an activity or asset from government to private control or operation.
Why It Matters
It can improve efficiency or investment in some settings, while raising concerns about access, accountability, and monopoly.
How It Works
Government sells assets, grants concessions, or contracts with private providers.
History
Privatization expanded internationally in the late twentieth century.
Example
A city may contract private companies to collect waste.
Common Misconceptions
- Privatization always means selling property.
- Private provision is always cheaper.
- Government has no role after privatization.
Related Terms
- Fiscal Policy
- Monetary Policy
- Inflation
- Economic Growth
- Government Spending
Related Topics
See Also