Assessment of effectiveness of privation on enterprises performance in Tanzania: a study of selected enterprises

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University of Dar es Salaam
This study assesses the effectiveness of privatization on enterprise performance in Tanzania by considering the effect of private ownership on enterprise sales revenue, Profit Before Interest and Taxes (PBIT), and production volume, which are variables used in this study. The study has been carried out as a result of contradicting viewpoints of various people on the subject of privatization in Tanzania. Some people are of the opinion that privatization has been successful in improving performance of enterprises while others maintain that there is no neutral evidence to the effect. The study uses a sample of 16 privatized enterprises. It was conducted by reviewing information on performance of firms before they were privatized. This information was mostly retrieved from the PSRC archives. The pre — privatization information is processed to come up with an average for each variable which is compared with the average processed from the post privatization data. Post privatization information was obtained by circulation of questionnaires to the privatized enterprises and review of secondary documents. The averages for both pre and post privatization periods were subjected to the sign test and hypotheses are tested. The results of hypotheses testing indicated that privatization has been effective in improving performance in the production volume only; but not in the sales revenue and PBIT which have not been strong enough. In general the assessment indicated that the recorded increase in the selected variables (i.e. Sales revenue and PBIT) were not strong enough to boast of, although they are superior compared to those which existed in most of the enterprises immediately before or during privatization of the concerned enterprises. The overall conclusion reached is that post privatization results should be interpreted in a cautious way to avoid arriving at conclusions which might be misleading.
Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class Mark (THS EAF HD4420.8.T34M48)
Privatisation, Enterprise performance, Tanzania
Mkumba, S. M (2007) Assessment of effectiveness of privation on enterprises performance in Tanzania: a study of selected enterprises, Master dissertation, University of Dar es Salaam.