Publication:
Privatization and Labor Force Restructuring around the World

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dc.contributor.authorLópez-de-Silanes, Florencio
dc.contributor.authorChong, Alberto
dc.date.accessioned2014-08-11T17:00:09Z
dc.date.available2014-08-11T17:00:09Z
dc.date.issued2002-09
dc.description.abstractSome critics of privatization argue that poor labor force restructuring is a key concern and that governments should establish better retrenchment programs. Using new data from a sample of 400 companies in the world, Chong and López-de-Silanes test competing theories about the wisdom of retrenchment programs and their effect on prices paid by buyers, and rehiring policies by private owners after privatization. The results show that adverse selection plagues retrenchment programs carried out by governments before privatization. Controlling for endogeneity, several labor retrenchment policies yield a negative impact on net privatization prices. In confirmation of the adverse selection argument, various types of voluntary downsizing lead to a higher frequency of rehiring of the same workers by the new private owners. Compulsory skill-based programs are the only type of program that is marginally associated with higher prices and lower rehiring rates after privatization, but the political and economic costs of this policy may make it somewhat impractical. While a qualified non-intervention policy appears to be the safest bet in labor retrenchment before privatization, another one might be to set up a social safety net or labor reallocation program before privatization, and then let the new private owners decide who is redundant and who is not. Setting up the program before privatization may help with the political viability of the process and letting the new owners manage the retrenchment may help avoid adverse selection.en
dc.identifierhttp://documents.worldbank.org/curated/en/2002/09/2018944/privatization-labor-force-restructuring-around-world
dc.identifier.doi10.1596/1813-9450-2884
dc.identifier.urihttps://hdl.handle.net/10986/19280
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 2884
dc.rightsCC BY 3.0 IGO
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectACCOUNTING
dc.subjectADVERSE SELECTION
dc.subjectASSETS
dc.subjectASYMMETRIC INFORMATION
dc.subjectBANK PRIVATIZATION
dc.subjectCENTRAL BANK
dc.subjectDEVELOPED COUNTRIES
dc.subjectECONOMIC SECTORS
dc.subjectEMPLOYMENT
dc.subjectFINANCIAL INFORMATION
dc.subjectFISCAL DEFICITS
dc.subjectFISH
dc.subjectINFLATION
dc.subjectLABOR FORCE
dc.subjectLAWS
dc.subjectNET SALES
dc.subjectPOLICY RESEARCH
dc.subjectPRESENT VALUE
dc.subjectPRIVATIZATION
dc.subjectPUBLIC POLICY
dc.subjectRETIREMENT
dc.subjectSTRUCTURAL ADJUSTMENT
dc.subjectTAX ADMINISTRATION
dc.subjectTRANSITION ECONOMIES
dc.subjectUNEMPLOYMENT LABOR FORCE POPULATION
dc.subjectDOWNSIZING
dc.subjectREDUCTION IN FORCE
dc.subjectPRIVATIZATION OF PUBLIC ENTERPRISES
dc.subjectSOCIAL SAFETY NETS
dc.subjectREDUNDANCY
dc.subjectTARGETING
dc.subjectADVERSE SELECTION
dc.titlePrivatization and Labor Force Restructuring around the Worlden
dspace.entity.typePublication
okr.crosscuttingsolutionareaJobs
okr.crossref.titlePrivatization and Labor Force Restructuring around the World
okr.date.doiregistration2025-04-10T10:35:55.472230Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2002/09/2018944/privatization-labor-force-restructuring-around-world
okr.globalpracticeSocial, Urban, Rural and Resilience
okr.globalpracticeGovernance
okr.globalpracticeSocial Protection and Labor
okr.globalpracticeHealth, Nutrition, and Population
okr.guid939741468739471281
okr.identifier.doi10.1596/1813-9450-2884
okr.identifier.externaldocumentum000094946_02100304104885
okr.identifier.internaldocumentum2018944
okr.identifier.reportWPS2884
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2002/10/12/000094946_02100304104885/Rendered/PDF/multi0page.pdfen
okr.sectorPublic Administration, Law, and Justice :: General public administration sector
okr.topicBanks and Banking Reform
okr.topicEnvironmental Economics and Policies
okr.topicSocial Protections and Labor::Labor Policies
okr.topicHealth Economics and Finance
okr.topicFinancial Crisis Management and Restructuring
okr.topicUrban Development::Municipal Financial Management
okr.topicHealth, Nutrition and Population
okr.unitOff of Sr VP Dev Econ/Chief Econ (DECVP)
okr.volume1
relation.isAuthorOfPublication93c7d1b0-9787-5978-b81f-7849e43f4ac3
relation.isAuthorOfPublication.latestForDiscovery93c7d1b0-9787-5978-b81f-7849e43f4ac3
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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