what is public enterprise?

public enterprise, a business organization wholly or partly owned by the state and controlled through a public authority. Some public enterprises are placed under public ownership because, for social reasons, it is thought the service or product should be provided by a state monopoly. Utilities (gas, electricity, etc.), broadcasting, telecommunications, and certain forms of transport are examples of this kind of public enterprisepublic enterprise, a business organization wholly or partly owned by the state and controlled through a public authority. Some public enterprises are placed under public ownership because, for social reasons, it is thought the service or product should be provided by a state monopoly. Utilities (gas, electricity, etc.), broadcasting, telecommunications, and certain forms of transport are examples of this kind of public enterprise. Public enterprises are usually intended to pay their way in the longer term, and yet they may be subject to political constraints in their pricing policy that could be in conflict with that objective. Conversely, for social reasons they may receive hidden subsidies or enjoy additional protection not available to competitors. Such factors tend to distort the normal commercial operations of the corporation or the company and often lead to managerial disorientation. Partly because of these noncommercial considerations, public enterprises may appear to be highly inefficient and, in times of difficult trading conditions, may be a drain on public resources. However, the measurement of the efficiency of a public enterprise is no easy matter. When it produces a marketable product, such as coal or steel, that competes with other products, the normal commercial criterion of profit may be adopted to assess its performance. In the case of a utility enjoying monopoly power, economists have developed concepts like cost-benefit analysis as a performance measurement tool. In recent years many state enterprises in the developed