Summary: The primary objective of a mass privatization program is to create the underlying base for a market economy by privatizing state-owned enterprises as expeditiously as possible. Given the constraints in many former socialist countries, such as little private capital formation, a political limit on the sale of enterprises to foreign investors, a need to involve and commit the population at large to the process of economic transformation, and a social need to seek equity through widely-distributed ownership, mass privatization programs have been highly attractive and successful in accomplishing this goal. This paper outlines and analyzes the conceptual approaches toward mass privatization that were adopted in the Czech and Slovak Republics, Poland, Lithuania, and Russia. The authors weigh the advantages and disadvantages, along with the potential risks and rewards of these different approches to mass privatization within the varying political, social, and economic contexts of each country. Each state of the privatization process, from the initial distribution of vouchers to the post-privatization implications for capital market development and restructuring, is examined within the existing privatization climate of each country. A number of theoretical issues relating to portfolio analysis, corporatization, voucher schemes, investment funds, state property agencies, and corporate governance also are analyzed.
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