What are the advantages and disadvantages of public ownership?

Natural monopoly, welfare over profit, profits can be reinvested

advantages of public ownership

helps avoid duplication and ensures access by everyone

How is public ownership good for natural monopolies?

natural monopolies

in some industries it is wasteful to have multiple companies building separate systems

Network Rail owns and maintains UK railways to benefit all users

Application for natural monopolies

no competition=>public orgs may lack pressure to be efficeint=>depends if properly managed

evaluation of natural monopolies

socially beneficial decisions and everyone receives care regardless of circumstance(less inequality)

How is public ownership good for focus on welfare not profit?

no profit=>disincentivised to be efficient and innovate

evaluation of welfare over profit

any profit made can be redirected and retained within the public sector, reducing the need for taxation

How is public ownership good for reinvestment of profits?

reduced efficiency, risk of political interferences, cost of taxpayer

disadvantages of public ownership

lack of competition leads to inefficiency

How does public ownership lead to reduced efficiency?

depends on if there is good leadership and high accountability that gives quality service and uses public funds responsibly

evaluation with reduced efficiency

gov may run public businesses to suit political interests

How does public ownership lead to risk of political interference?

low prices prior to elections despite causing long term financial issues

application for risk of political interference

depends on independent regulators and professional managers reducing political influence and run public services more like businesses

evaluation with risk of political interference

burden falls on taxpayers if unprofitable or a failure

How does public ownership lead to cost of taxpayer?

may be more beneficial than private ownership in long run=> with more investment=>better quality public services

evaluation of cost of taxpayer