The Rise and Fall of State-Owned Enterprise in the Western World. Edited by Pier Angelo Toninelli. Cambridge: Cambridge University Press, 2000. Pp. ix, 320. $49.95.

Abstract

This book offers historical perspectives on the origins and purposes of state-owned enterprises in the United States and Western Europe, the performance of these companies, and the growing dissatisfaction with public ownership, culminating in a wave of privatizations over the past twenty years. It combines analytical essays on various aspects of public ownership with a series of country cases (Germany, Italy, Britain, France, Spain, Austria, and the United States). As is often the case with edited volumes, not all the contributors see eye-to-eye. The sharpest contrast is between the paean to the developmental state offered by Erik Reinert on the one hand, and the neoliberal understanding that informs the concluding essay by Louis Galambos and William Baumol on the other. For Galambos and Baumol, the experience of public enterprise teaches us that “there is no substitute for the profit motive and the rigors of fierce competition in eliciting growth of output, productivity, and innovation from the individual firm” (p. 308). The other authors, while closer to Galambos and Baumol's position than to that of Reinert, nonetheless offer a more nuanced perspective on public ownership.