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The politics of state-owned enterprises: The case of the rail sector

The politics of state-owned enterprises: The case of the rail sector

Lethbridge, Jane ORCID: 0000-0002-0094-9967 (2019) The politics of state-owned enterprises: The case of the rail sector. Routledge Handbook of State-Owned Enterprises. Routledge. (In Press)

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Abstract

This chapter examines the politics of state-owned enterprises (SOEs) through an analysis of the rail sector in several countries. It starts from the premise that state-owned enterprises are created as a result of politics but the political conditions and settings may change over time, which result in different types of public ownership and state support. Studies which explore the politics of SOEs often take several political perspectives, some critical of the performance of SOEs, others supportive of their wider socio-economic functions. This is an indication of the highly politicised nature of SOEs and hints at the complexity of analysing and understanding the politics of SOEs which are essentially created as a result of political decisions. Much of the literature on the changing role of the state has been developed in Europe and North America but many of the same processes can be seen across the world. These influence the political processes within which SOEs have to operate.

In order to explore some of the specific politics of SOEs, the rail sector has been chosen as a way of understanding some of the processes that result in the evolution of SOEs and what contributes to a ‘politics of SOEs’. The rail sector provides a public service which contributes to economic and social development through the transporting of people and goods. It requires investment in infrastructure which the state has traditionally provided. The rail sector has an increasingly international dimension and this illustrates how SOEs are becoming part of a global sector (OECD, 2016).

Four case studies of France, Germany, Great Britain and China have been developed as a way of exploring how the rail sector has been strongly influenced by SOEs and why national and local level politics influence the process of state-owned enterprise management. Many of these processes are constantly evolving but not necessarily in a systematic way. The four countries have been chosen for several reasons. All have rail sectors which have been influenced by national public policies towards public ownership. France and Germany retain SOEs in the rail sector and it is ironic that these SOEs have also benefitted from privatisation in other countries, by successfully winning contracts to run privatised rail services. This has made them global companies. In the UK there is a mixed arrangement of SOEs in the rail sector with Great Britain having a privatised system with government control and Northern Ireland a state-enterprise rail system, an example of how regional issues affect rail policy. Three of the case study countries are in Europe and show some of the differential impacts of European Union legislation. China has a much stronger tradition of SOEs but has had to modify some if its SOE policies in the last few decades. However, the use of SOEs in rail and infrastructure are part of an international policy which aims to secure Chinese influence globally.

Starting with an overview of recent literature into SOEs, this chapter aims to answer three research questions:

1. Why have state-owned enterprises (SOEs) played an important role in the rail sector in several countries?
2. How have national and regional politics influenced the development of state-owned enterprises (SOEs) in the rail sector?
3. How do public policies which have informed the rail sector reflected debates in contemporary politics, e.g. privatisation or public ownership?

Item Type: Book Section
Uncontrolled Keywords: state-owned enterprises, rail, state
Faculty / Department / Research Group: Faculty of Business
Faculty of Business > Centre for Work and Employment Research (CREW) > Public Services International Research Unit (PSIRU)
Faculty of Business > Department of International Business & Economics
Last Modified: 17 May 2019 14:00
Selected for GREAT 2016: None
Selected for GREAT 2017: None
Selected for GREAT 2018: None
Selected for GREAT 2019: GREAT 3
URI: http://gala.gre.ac.uk/id/eprint/23207

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