ABSTRACT
INTRODUCTION The last three chapters assessed the impact of UK privatisation on economic performance using a number of measures (namely labour and total factor productivity, value-added, the rate of profit and DEA). In this chapter the focus is on the impact of privatisation on specific inputs through an analysis of employment, wages, returns to capital and payments to outside suppliers. Economists have been most concerned with the general implications of privatisation for economic efficiency in terms of productivity and costs of production. To date there have been surprisingly few serious studies of the effects of privatisation in the UK on the return to particular inputs and therefore on the firm’s income distribution. A few early studies reported higher profitability after privatisation in some though not all cases (Bishop and Kay, 1988; Hyman, 1989; Yarrow, 1989) something we confirmed over a longer period in chapter 6.
