or the risk of bankruptcy; consequently, they are exposed to less scrutiny by the equity and debt markets than their private-sector counterparts. The problem of performance monitoring is compounded by the lack of direction within public enterprises. Enterprises that are able to focus on clear, noncontradictory objectives can be expected to operate efficiently. However, public enterprises are often assigned multiple goals such as the delivery of private goods or services; delivery of Community Service Obligations; as well as other policy or regulatory functions. Where these goals conflict (as they frequently do), reliable measurement of performance becomes virtually impossible (Hogbin 1995 p 43). It is argued that a clear profit objective is an important goal that many public enterprises should adopt. Since public enterprises do not have a clear profit objective, there is little or no incentive to minimize costs.
             The lack of incentive to minimize costs can also be attributed to the government's willingness to subsidize public enterprise deficits out of the public purse to meet 'social objectives. This is compounded by political and union pressures to protect employment and self-interested management perusing their private goals. Consequently, productive efficiency is not achieved. Profit maximizing firms, on the other hand, will continually search for gains in productive efficiency and improvements in responsiveness to consumer demand. Thus, supporters of privatization argue that gains in efficiency can be achieved by setting cost-minimization objectives within the public sector.
             Another cause of inefficiency that privatization will arguably resolve is the lack of managerial accountability. Regardless of how clear managerial objectives are, efficiency can not be achieved unless managers are given the authority to make the key production decisions required. Externally-imposed controls inhibit managerial innovation and reduce accou...