Privatization policies have swept the world and helped restructure economic activity. Although ther are clear benefits to privatization initiatives, many attempts have been rejected. Unfortunately, most policy research has ignored this fact. Research on privatiation has mostly focused on programs that have been accepted, and not those that have been rejecte. This study, however, breaks new ground by examining the microeconomic, macroeconomic, and political factors that shaped both types of privatization outcomes. This work, based on the book, The Logic of Privatization - The Case of Telecommunications in the Southrn Cone of Latin America, suggests that the implementation of privatization policies hinges on the ability and capacity of the political leadership to control the bargaining process during the divestiture of state-owned companies. Failure to control the process may expand the conflict beyond the scope of the original participants and result in its rejection. This study statistically examines the economic and political data of sixteen attempts to privatize telphone companies around the world between 1981 and 1993. The findings suggested that microeconomic factors were not very significant in determining the privatization outcomes - however, macroeconomic factors were found to e sightly more important. The political factors, nonetheless, proved to be the most important variables in explaining the different outcomes. These findings were supported by the statistical results

Volume 23

Numbers 5-8