Business Studies

Long Answer Type Questions: Can the public sector companies compete with the private sector in terms of profits and efficiency? Give reasons for your answer.


SOLUTION
No, public sector companies cannot compete with the private sector in profit and efficiency due to following reasons:
  1. Motive: The main motive of private sector is to earn profit and, whereas the main motive of public sector is to provide services to public.
  2. Stakeholding : The major stakeholding in the case of public sector is goverment and its control lies in the hands of the goverment, whereas in the case of the private sector the individual is the major holder in the shares of the company.
  3. Efficiency : The efficiency of the private sector is more as the efficiency and working depends upon the private individuals , whereas in the case of public firm the efficieny goes down due to in efficiency.
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