Response of people to privatisation

Privatization has been a major element of reform in Central and Eastern Europe, however its effects on firm marketing capability and performance are unclear. This study tests a number of hypotheses concerning the effects of privatization on marketing capability, activities and performance in Poland. The main conclusions are that privatization leads to enhanced marketing capability, to more pro-active marketing activities, such as the adoption of longer term priorities, to an emphasis on delivering superior quality to customers and to more active new product development. On both financial and market-based criteria, the privatized firms are seen to outperform their state-owned counterparts.
Attitudes toward the impending privatization of the UK electricity supply and water industries were assessed by means of a questionnaire distributed to 225 visitors to holiday beaches in SW England as part of a broader survey of perceptions of coastal pollution. The water industry was evaluated more negatively than the electricity industry in terms of both its present performance and the changes in its practice anticipated after privatization. The levels of pollutants in the immediate environment were expected to increase, with those individuals most opposed to privatization being especially pessimistic. The results suggest that respondents did not consider privatization to be a corrective for poor previous industrial practice, but rather that it would lead to improvement where an industry was seen as performing well, and deterioration where it was seen as performing badly. At worst, this was seen as likely to involve the privatized industries putting their own financial interests ahead of those of the public and the environment. It is argued that individuals based their attitudes on previous experience and on assumptions about the effects of market forces on behaviour that differed from those implicit in the policy of privatization.