Interesting debate in the Indian blogs about what matters more for economic performance: private ownership, or competition? Ravikiran Rao thinks that ownership is key. Ramnath thinks competition is more important.
I think it's a false dilemma. A private monopoly is likely to be a disaster - but most private monopolies are monopolies because governments have tilted the playing field in their direction. And a government-owned firm in a genuinely competitive market is fine - but who expects that market to stay genuinely competitive if the government firm gets into trouble? Private ownership and competition tend to go together - not inevitably, but typically.
The next debate, of course, is whether to privatise first and liberalise later, or vice-versa...? Comments are open.
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