What does privatization refer to?

Privatization refers to the process of transferring government responsibilities or services to a non-government entity. This typically involves outsourcing public services that were previously managed by government agencies to private companies or organizations. The intent behind privatization is often to enhance efficiency, reduce costs, and improve the quality of services by leveraging the competitive advantages of the private sector.

In this context, privatization can encompass various forms, such as privatizing public utilities, transportation services, or even entire operations of governmental departments. It is fundamentally about shifting the ownership or management of certain services from the public sector to the private sector.

Understanding privatization in this light highlights its role in public policy and fiscal management, as well as the broader implications for governance and service provision.