Abstract
M.Comm. (Economics)
The aim of this study is to investigate the possibility of privatising local government functions, with special reference to the Johannesburg City Council. Privatisation is defined as the systematic transfer of appropriate functions, activities or property from the public to the private sector, where services, production and consumption can be regulated more efficiently by die market and price mechanisms. The purpose of privatisation is to improve the performance of the economy through the effective use of production factors, optimising market forces and by increasing the percentage of net
fixed investment in the private sector. The study was carried out in two stages. In the first, the theory of the firm, namely perfect competition; monopoly; monopolistic competition; oligopoly; duopoly; price discrimination; monopsony and bilateral monopoly was discussed. Consequently a function evaluation programme was activated to determine which functions and activities of the Johannesburg City Council could possibly be privatised. In the second part of the study, the methods for privatisation, namely the 'Sale of public sector enterprises and assets; leasing of business rights and contracting out, were empirically analysed by discussing three case studies in the Johannesburg City Council.