Question

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.

Answer 1

No, public sector companies cannot compete with the private sector in profit and efficiency due to following reasons:
(i) Motive. The motive of public sector is social service whereas the motive of private sector is earning profit.
(ii) Autonomy. The working of public sector enterprise is subject to interference of government whereas private sector enjoys complete freedom of operation.
(iii) Management. Due to bureaucratic controls, the management of public sector enterprise is poor and inefficient whereas private sector appoints professional and efficient management.