ABSTRACT
In the last twenty years public utilities (electricity, gas, telephone, transport, etc.) enterprises have been privatized and in most of the cases new utilities markets have been created. The privatization policy has been concomitant with the huge, and workers’ adverse, modifications of income distribution recorded in almost every capitalistic economy, and with the reduction of the labour share of social product in continental Europe. Privatization policies contributed to this modification of income distribution, for privatized firms are nowadays in the hands of (few) private subjects who achieve the overwhelming part of the rent generated in the newly created markets. In this chapter, I estimate the excess returns on privatized firms in Europe over the ‘average’ financial market return using a variant of market Beta analysis. Results indicate that privatized firms have beaten the market during the sample period and that the return to shareholders has been higher when the quota of privatized public utilities was high. This excess return is interpreted as a rent transfer in favour of private shareholders.
