State Manufacturing Enterprise in a Mixed Economy

Book excerpt: The author raises questions that are relevant to most developing countries. Turkey's emphasis in the past on capital-intensive import substitution in preference to light labor-intensive export industries had negative consequences for country's growth, balance of payments, and domestic employment. This emphasis, together with the way public enterprise was managed, also helped to promote an inefficient state sector and delayed the maturation of the private sector. The author examines the performance of the state industrial ventures, collectively and individually. Deriving true financial returns from published figures and the economic returns by various adjustments of these financial returns is detailed. The important question about long-run economic benefits: to what extent might they compensate for proximate economic losses in the state sector is the major emphasis of this book.