Government control of privatized firms

Bernardo Bortolotti, Mara Faccio

Research output: Contribution to journalArticlepeer-review


We study the change in government control of privatized firms in OECD (Organisation for Economic Co-operation and Development) countries. At the end of 2000, after the largest privatization wave in history, governments retained control of 62.4 of privatized firms. In civil law countries, governments tend to retain large ownership positions, whereas in common law countries they typically use golden shares. When we combine these two mechanisms, we find no association between a country's legal tradition and the extent of government control. Rather, we document more prevalent government influence over privatized firms in countries with proportional electoral rules and with a centralized system of political authority.

Original languageEnglish (US)
Pages (from-to)2907-2939
Number of pages33
JournalReview of Financial Studies
Issue number8
StatePublished - Aug 2009

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics


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