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Difficulty: MediumPrivatization, Commercialization, and Deregulation of Public Enterprises

A state-owned postal service agency is reorganized by the government to operate strictly as a profit-making corporate entity without receiving state subventions or transferring equity ownership to private investors. Which public enterprise reform policy is demonstrated in this scenario?

  1. Full commercializationAnswer
  2. B
    Partial commercialization
  3. C
    Outright privatization
  4. D
    Market deregulation

Answer

Full commercialization
Full commercialization occurs when a public enterprise is restructured to generate profit and cover all capital and operational expenses independently without state subventions, while the government retains complete ownership.

Step-by-Step Solution

1
Analyze ownership structure in the scenario
State ownership remains 100% intact with no equity sold to private investors, excluding privatization policies.
Privatization specifically requires equity or asset transfer from public to private hands.
2
Analyze financial and operational subsidy status
The enterprise must operate as a profit-making commercial entity without state treasury subventions.
Complete removal of state subventions combined with total state ownership defines full commercialization, as opposed to partial commercialization where state grants may still subsidize social services.

Key Concept

Full Commercialization vs. Partial Commercialization and Privatization
Estimated Time:1m 0s
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Topics

Privatization, Commercialization, and Deregulation of Public Enterprises

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