New Labour’s community development work was all private-sector driven, consultation-tinged regeneration that was done to poor people rather than being controlled by them. I found it, on the whole, a massive waste of money.
All the alleged key causes of SOE [State-Owned Enterprise] inefficiency the principal-agent problem, the free-rider problem and the soft budget constraint are, while real, not unique to state-owned enterprises. Large private-sector firms with dispersed ownership also suffer from the principal-agent problem and the free-rider problem. So, in these two areas, forms of ownership do matter, but the critical divide is not between state and private ownership it is between concentrated and dispersed ownerships.ha-joon chang
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