ABSTRACT
This book set out to explain the failure of four Malaysian case studies by asking three questions: Why privatize in developing countries? Why may privatization fail? What is needed to make privatization work? We have argued that privatization can be motivated by economic and political factors and will often be intrinsically tied with state efforts to promote capital accumulation and develop entrepreneurial capacity in developing countries. Furthermore, the very fact that it is the government which decides on privatization makes it an inherently political process, with potentially large distributive and political consequences (e.g. see Vickers and Yarrow 1991; Fine 1997). In addition, a lack of entrepreneurial capacity in developing countries can paradoxically lead to intense political competition for privatized assets as there are many potential entrepreneurs whose entrepreneurial capacity has not been tested. This then presents a very different set of problems and conditions for successful privatization which is directly related to the state’s capacity to facilitate the transition of candidates into capitalists.
