Definitions of public enterprise can vary between countries and change over time. The United Nations definition of a public enterprise is ‘an incorporated or large unincorporated enterprise in which public authorities hold a majority of the shares and/or can exercise control over management decisions’. Some of the problems with this approach are reviewed in the following three sub-sections.
A loose definition of a public enterprise might be ‘an enterprise which is controlled by the government’. However, such a definition raises problems of interpretation in specific cases. For example, how can we be sure that the government ‘controls’ a particular firm? It is the essence of our entire approach to government-industry relationships that one party can rarely be said to ‘control’ the other in a mechanical way. Does ‘the government’ mean just the central government or does it include local government? For example, statistical information from some countries excludes enterprises run by local governments.
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