Some transition economies decided to privatize their SOEs into the hands of insiders – managers and employees of the companies (MEBO). Why can this make sense?

Question

Some transition economies decided to privatize their  SOEs into the hands of insiders – managers and employees of the companies (MEBO). Why can this make sense?

Answer

This form of privatization was expected to bring new resources to the company (new know-how, access to foreign service and distribution networks, better access to financing).

Answer

This method can reduce the risks of so-called wild or unofficial privatizations.

Answer

The governments were worried about immigration which typically follows the sale of companies to foreign hands.

Answer

This method can provide better continuity and reduce the risks of significant shocks in the governance of the company.

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Some transition economies decided to privatize their SOEs into the hands of ins...

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