Planning and Budgeting

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Developed and Developing countries have remarkably pursued privatization policies during recent decades. The successes followed by performing this policy in developing countries, the collapse of totally concentrated and governmental economic systems and the polices of international economic agential program of economic structure reforms. Although the results of performing this policy have been successful in most developed countries, the results of privatization in developing countries are not fully vivid and in some cases, there are many ambiguities regarding the success of this policy in such countries. Economic policy makers in Iran have began to pay attention to privatization in early 1980s and it was considered and followed in Irans social, economic and cultural plans. This research paper firstly tries to survey issues related to privatization in Irans governmental companies. Next, it compares the efficiency of investments made by private and governmental sectors within 1971-2001 by means of a growth model. The criterion for efficiency is final productivity of capital in both private and governmental sectors. Accordingly, if it is proved that the efficiency of private investments is more than that of governmental sector, one could conclude that performing privatization policy will accelerate economic growth in Iran through increasing the efficiency of investments in the whole country. Otherwise, the obstacles of private sectors efficient activity should be identified in order to pave the way for improving performance and increasing efficiency of private investments. Furthermore, the experiences of successful countries should also be used for privatization and transferring Governments economic activities to private sector. The findings of the paper show that statistically there is no significant difference between the final productivity of capital in private and governmental sectors during the surveyed period. This, in turn, signifies that performing privatization policy and transferring the Governments economic activities to the nongovernmental sector without making structural reforms in Irans economic areas and eliminating the obstacles in the way of private in vestments can not finalize the expectations of this policy and it will not lead to acceleration of Irans economic growth.

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