Question

State three reasons why privatization is not always desirable.

Answer 1

Arguments in favour that why privatization is not always desirable areas discussed:

1. Public interest: The profit motive is always the major goal of the private sector. Privatization of many businesses, including healthcare and education, is a bad concept.
2. Losing profits: Because some of the privatised enterprises turn out to be lucrative in the long run, the government loses out on dividends.
3. Monopoly: Privatization produces monopolies, and certain industries, such as water and rail, require fair regulation to protect customers from abuse.