Privatization in developing countries: Assessing the preprivatization perceptions of stakeholders in postwar Liberia

The government of Liberia, a post-conflict country with rates of 64 percent poverty and 80 percent unemployment, contemplated privatization without a clear understanding of the level of public support. Lacking public support, policies endorsing privatization have little chance of success. The theoretical foundation of the study is public choice, positing that citizens prefer private ownership of the means of production. The purpose of this study was to fill the gap in knowledge related to support for any type of privatization by key Liberian stakeholders. This qualitative case study used semi-structured, in-depth interviews to gather responses on key questions, including perceptions about privatization; issues and concerns about public sector service delivery; and alternatives to privatization. A self-designed, precoded response matrix was used to analyze the interview responses for perception, common themes, and alternatives to privatization. Participants included university students, academics, professionals, and employees of two state-owned enterprises. Results indicated that Liberian stakeholders were cautiously supportive of privatization and favored methods such as management contracts and build-operate-transfer rather than 100 percent divestiture, or full-asset sales. A key discovery of the study is that access and affordability, although important in the privatization literature, were secondary to Liberian stakeholders during the study; stakeholders were more concerned about efficiency and service delivery. Corruption, lack of transparency, and poor service delivery were common concerns. This study has added to our understanding that stakeholders have greater interest in efficiency and service delivery than access and affordability. This nuanced understanding of privatization in Liberia can help policymakers formulate better privatization policies in postwar Liberia that can lead to economic growth.