Lesson 14 - Privatisation And Regulation

Question 1

What is nationalisation?

Answer 1

Public ownership of previously private industries

Question 2

What are the arguments for nationalisation?

Answer 2

• government is aiming to make normal profits, so they can offer lower prices
• gov can take externalities into account

Question 3

What are the arguments against nationalisation?

Answer 3

• expensive, especially when the national debt is so huge
• no pressure to improve quality of the service, or innovate

Question 4

What is privatisation?

Answer 4

• transferring publicly owned assets to the private sector