How does the private enterprises are more productive resources than government enterprises in US?
Answer -
private enterprises are more productive resources than government enterprises in US due to following reasons -
1. Lack of competition - Government enterprise are generally monopolies which does not have to face any market competition in there respective field .Which lead firm to be less efficient with there resources and functioning .
2. Support of Government - In government owned enterprises mangement knows that they have support of government so, any critical scenario they can be bailed by governments specially if these enterprises are working in the field of public utilities like transport , water , electricity etc.
3. Government subsidies - Generally government enterprises get government subsidies or tax benefits which are not available to private firms which reduce the pressure to regarding revenue generation
4. Profit Targets - Private firms usually have profit targets to keep continue the business. If private firm do not able recover there even there variable cost this lead them to close the business and leave the market
5. Higher competition - Private firms usually works highly competitive market segments with many other competitors so if they are not efficient and productive with there work they might lose there market share to other competitors.
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