Photo AI
Explain the term ‘Privatisation’ and state two examples of companies that have been privatised in Ireland - Leaving Cert Economics - Question 7 - 2008
Question 7
Explain the term ‘Privatisation’ and state two examples of companies that have been privatised in Ireland. Outline two arguments in favour of Privatisation and two ... show full transcript
Worked Solution & Example Answer:Explain the term ‘Privatisation’ and state two examples of companies that have been privatised in Ireland - Leaving Cert Economics - Question 7 - 2008
Step 1
Explain the term ‘Privatisation’ and state two examples of companies that have been privatised in Ireland.
Answer
Privatisation refers to the process of transferring ownership of public sector assets to private individuals or organizations. This transfer aims to enhance efficiency, improve service quality, and encourage competition within the market.
In Ireland, notable examples of companies that have undergone privatisation include:
- Aer Lingus: The flag carrier airline of Ireland, which was partially privatised in the early 2000s.
- Eircom: The country's main telecommunications provider, which was privatised and listed on the stock exchange in 1999.
Step 2
Outline two arguments in favour of Privatisation.
Answer
-
Improved Quality / Choice of Services: Privatised firms often focus on enhancing their quality and efficiency, providing better service options for consumers.
-
More Competitive Prices: With the entry of private competitors into the market, prices are typically driven down, benefitting consumers through better deals on goods and services.
Step 3
Outline two arguments against Privatisation.
Answer
-
Loss of Non-profit Making Services: Essential services that may not be profitable could be discontinued, impacting consumers who rely on them.
-
Standards of Service May Deteriorate: When public services are privatised, the profit motive may lead to a decline in service quality, as companies seek to reduce costs.