ABSTRACT
This chapter focuses on certain aspects of how it emerged, which have an impact on its performance: the genesis of public enterprise, the nature of public entrepreneurship, the organisational structure, and the application of the concept of comparative advantage in practice. It examines whether the cross-section of public enterprises emerged in perfect consonance with its theoretical justification. The chapter suggests that there are costs which flow from the defectiveness of an investment decision and the dilatory and non-professional processing of investment approval. There is a broad distinction n the way public enterprise came into being in developed and developing countries. Most public enterprises in developing countries have, generally, though not exclusively, been the product of governmental sponsoring or creation for the first time. They represented the very beginnings of activity in many sectors. It is possible that the quality of public entrepreneurship improves where an established public enterprise undertakes expansions, rather than the government, as in the UK or Italy.
