Abstract
This article presents empirical evidence for the Spanish case on the hypothesis that public ownership may be a determinant of a firm’s performance. Two alternative definitions of efficiency are proposed: relative productivity and profitability. The former tries to approximate the concept of technical or productive efficiency, whereas the latter is associated with allocative or price efficiency. The role of ownership is tested, conditioning for the degree of competition, the financial position of the firm, and labor quality. The data used are a sample of Spanish manufacturing firms for the period 1983-1996. The results show a negative and significant coefficient of the public ownership variable, which would denote that public ownership has a negative effect on efficiency. In addition, the degree of competition seems to have a positive and significant effect on firm’s performance. As for the variables that proxy the degree of financial constraint, the coefficient of the cash flow per unit of capital has a positive and significant sign.
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