Nationalization Wide

Nationalization Wide

Nationalization A wide variety of methods has been devised for running state-owned enterprises, ranging from an autonomous body organized as a private undertaking at one extreme to a collective administration at the other. In Great Britain the system of the public corporation has been used for all the major nationalized undertakings; it is a hybrid designed to ensure the ultimate control of Parliament while retaining efficient business activity.

Independent of the origin of nationalization and its administration, the state is faced by a common problem: how to ensure efficiency and at the same time exercise adequate control. Where an enterprise is competitive, it must adopt the market yardstick of profits if it is to survive in a mixed capitalist economy. Where the enterprise is monopolistic, the necessity for regulation by such expedients as ministerial control, parliamentary inquiries and consumer councils, etc., frequently conflicts with the necessity for efficiency, and it is often difficult to reconcile these requirements. In Britain the most stubborn problems have been those of pricing whether to sell at subsidized prices to keep the cost of living and industrial costs down, or to sell at 'commercial' (market) prices to earn sufficient to replace capital and to discover uneconomic units. In the early and middle 1900's there has been an increasing emphasis on making nationalized industries obey the test of this market, e.g. the Beelong reforms in railways and the Robens approach in coal.

The Social Democratic Party in Germany has largely abandoned nationalization as a basic aim, probably because of the success of the 'German miracle' the free market economy introduced by Chancellor (then Economics Minister) Ludwig Erhard. The British Labour Party has also tended to reduce the emphasis on nationalization.

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