Privatization and Firm Performance: Evidence from Iran`s Privatization Experience

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Bidhendi, Reza | 2022

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Type of Document: M.Sc. Thesis
Language: Farsi
Document No: 55292 (44)
University: Sharif University of Technology
Department: Management and Economics
Advisor(s): Ebrahimnejad, Ali
Abstract:
Privatization in Iran was primarily driven by the 2004 amendment to the Article 44 of the Iranian Constitution. Improving firms' efficiency is cited as the key goal of the privatization program. The two prominent characteristics of the privatization program in Iran are complex ownership structure and transferring ownership from the government to government-affiliated institutions and organizations. For these reasons, the consequences of privatization in Iran may differ from those of other countries. Therefore, this study explores the relation between privatization and firm performance, as measured by firm efficiency, labor efficiency, investment, and the number of employees. As a significant portion of the ownership transfer was from the government to pension funds, the relation between this type of ownership transfer and change in firm performance is also examined.Using fixed effects regression, the relation between privatization and firm performance (and the transfer of ownership from the government to pension funds and the firm performance) has been estimated. The results confirm the existence of a significant relation between privatization and firm performance.
Keywords:
Privatization ; Iran ; Labor Productivity ; Firm's Performance ; Ownership Structure ; Private Equity ; Human Performance