This setting lets you change the way you view articles. You can choose to have articles open in a dialog window, a new tab, or directly in the same window.
Open in Dialog
Open in New Tab
Open in same window

American Economic Review: Vol. 92 No. 1 (March 2002)

Expand

Quick Tools:

Print Article Summary
Export Citation
Sign up for Email Alerts Follow us on Twitter

Explore:

AER - All Issues

AER Forthcoming Articles

Machiavellian Privatization

Article Citation

Biais, Bruno, and Enrico Perotti. 2002. "Machiavellian Privatization ." American Economic Review, 92(1): 240-258.

DOI: 10.1257/000282802760015694

Abstract

We analyze politically motivated privatization in a bipartisan environment. When median-class voters a priori favor redistributive policies, a strategic privatization program allocating them enough shares can induce a voting shift away from left-wing parties whose policy would reduce the value of shareholdings. To induce median-class voters to buy enough shares to shift political preferences, strategic rationing and underpricing is often necessary. In the extreme, this may lead to free share distribution and voucher privatization. Shifting voting preferences becomes impossible when strong ex ante political constraints require large upfront transfers to insiders or when social inequality is extreme. (JEL D72, L33, P16, P35)

Article Full-Text Access

Full-text Article

Authors

Biais, Bruno (Université de Toulouse and IDEI, Place Anatole, France, 31000, Toulouse, France, and CEPR)
Perotti, Enrico (Department of Financial Management, Universirt of Amsterdam, Roeterstraat 11, 1018 WB Amsterdam, The Netherlands, and CEPR)


American Economic Review


Quick Tools:

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)

Explore:

AER - All Issues

AER - Forthcoming Articles

Virtual Field Journals


AEA Member Login:


AEAweb | AEA Journals | Contact Us