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Author Shirley, Mary
Source CiteSeerX
Content type Text
File Format PDF
Subject Domain (in DDC) Computer science, information & general works ♦ Data processing & computer science
Abstract When privatization is not feasible or palatable, some developing country governments seek to improve the performance of state enterprises by negotiating performance contracts with their managers. Many of these contracts have been put in place with World Bank assistance. Research shows that they rarely work. This Note summarizes the rationale for performance contracts and explores the reasons why they haven’t worked. It concludes that since a well-designed and-enforced performance contract can be as politically costly as a well-designed privatization, performance contracts are not likely to be successful in countries that lack the political will to privatize. Written contracts between governments and state enterprises have been widely used in World Bank projects since the first Bank operation supporting performance contracts, a 1975 operation in Senegal. A Bank survey of developing countries found 565 such contracts in thirty-two countries, and another 103,000 in China as of June 1994 (World Bank 1995). Although these
Educational Role Student ♦ Teacher
Age Range above 22 year
Educational Use Research
Education Level UG and PG ♦ Career/Technical Study