chapter 3 Flashcards
three types of public sectors
- departmental undertakings
- public corporation
- government company
features of departmental undertakings
- operate under overall control of one of the ministries of central or state government
- part of government only
- financed from annual budgets of government
- revenues are added to treasury of government
benefits of departmental undertakings
- easy formation
- effective control
- optimum utilisation of funds
- secrecy
- public revenue
demerits of departmental undertakings
- inflexibility
- lack of motivation
- lack of financial autonomy
- inefficient management
- red taoism and bureaucracy
statutory corporations
body corporate formed by a special act go parliament or by the central or state legislature. `
features of statutory corporations
1 created by act of parliament
2. operates under total control of central or state government
3. separate legal entity .
4. main motive of public corporation is serve to general public
5. managed by board of directors who are nominated by government
merits of statutory corporations
- administrative autonomy
- quick decision
- serve motive
- efficient staff
- professional management
demerits of statutory corporations
- autonomy on paper only
- lack of initiative
- rigid structure
- unfair practices
government company
any company in which at least 51 per cent of the paid up share capital is held by the central or state government or partly through both.
feature of government company
- all the provisions of companies act are applicable on a government company.
- wholly or partly owned by the government
- managed by a board of directors which are nominated by the government
- subject to ministerial control
- seprate legal entity
merits of government company
- administrative autonomy
- greater flexibility
- efficient staff
- collaboration
demerits of government company
- autonomy on paper only
- politcal interference
- board packed with government representatives
multinational company
a company which operates on many countries
features of multinational companies
- giant size and huge capital resource
- centralised capital
- advanced technology
- expansion of market territory
- foreign collaboration
joint ventures
when two or more firms joint together to establish a new enterprise
features of joint ventures
- increase resources and capacity
- access to technology
- innovation
- low cost of production
- established brand name
