Role of Public Enterprise in Developing Economies

1. Dr. Jamshed Adil, Institute of Commerce, Sindh University
PUBLIC UTILITIES
Public utilities refers to a service in which a
tendency to local monopoly calls the involvement
of public authority to secure the interest of the
end users
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Dr.Jamshed Adil, Institute of
Commerce, University of
sindh

2. Purpose of public utilities
I. Serve the economy of country
II. Deliver satisfactory service
III. Provide services at fair price
IV. Serve without any prejudice
Dr. Jamshed Adil, Institute of Commerce, Sindh University
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Dr.Jamshed Adil, Instititute of
Commerce, University of sindh

3. Concept of Public Utilities
 Public utilities denotes to those business tasks
that supply essential service to any nation or
community. All such essentials are required in
daily lives of public. Public utilities (PU) require
huge level capital investment. Generally
assumed that State should provide such utilities
at inexpensive rates.
 Special concessions are given to PU to
improve their performance
Dr. Jamshed Adil, Institute of Commerce, Sindh University
3
Dr.Jamshed Adil, Instititute of
Commerce, University of sindh

4. Features of Public utilities
I. Supply basic and essential services
II. Supplies provided are necessary
and have fixed demand
III. Natural Monopoly
IV. Heavy fixed Investment
V. Public control
VI. No selling concerns
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Dr.Jamshed Adil, Instititute of
Commerce, University of sindh

5. Social consideration
 These utilities are also known as
public services. They are basically for
betterment of common people in
society and play part for welfare of
community. Prices of P.U are decided
by state government by keeping in
view the concept of general masses
purchasing power and needs
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Dr.Jamshed Adil, Instititute of
Commerce, University of sindh

6. Forms of organisation for P.U
 P.U are run either by Government
directly are by local Governments.
 Local government consists of
Municipal corporations, Town councils
and its sub units.
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Dr.Jamshed Adil, Instititute of
Commerce, University of sindh

7. Advantages of Govt. form of
organisation
I. Control and proper supervision of
resources
II. Government carry responsibility to
meet up demand of public
III. Help in assessing needs of people
IV. Large level of network
V. Minimum financial restrictions
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Dr.Jamshed Adil, Instititute of
Commerce, University of sindh

8. Disadvantages
I. No flexibility
II. Lack of efficiency
III. Political considerations dominate in
policy making
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Dr.Jamshed Adil, Instititute of
Commerce, University of sindh

9. Local Government run P.U
I. More Democratic
II. Grass root access
III. Awareness of local sensitivities and
problems
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Dr.Jamshed Adil, Instititute of
Commerce, University of sindh

10. Drawback of Local Govt. run
P.U
I. Not capable to cater the needs and
solve P.U related issues of public
II. Politicisations
III. Not manageable for Local
Government due to its large level
operations
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Dr.Jamshed Adil, Instititute of
Commerce, University of sindh