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Nationalizing Oil in the 1970s

Dean Goodermote and Richard B. Mancke

Year: 1983
Volume: Volume 4
Number: Number 4
DOI: 10.5547/ISSN0195-6574-EJ-Vol4-No4-5
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Abstract:
National oil companies emerged during the 1970s as an important force within both oil-exporting and oil-importing countries. By 1980 they were producing and marketing well over half the crude oil available for sale on world markets. These oil companies prospered within oil-exporting countries as events increasingly confirmed that the principal source of economic power in the oil business was sovereign control over oil reserves rather than private control over technical, managerial, and capital resources. During the 1970s, many oil-exporting countries sought to exploit their new-found market strength and exercise greater control over their oil industry either by building up existing government-owned oil companies or by seizing the opportunity to create new ones.



Changes in the Operational Efficiency of National Oil Companies

Peter R. Hartley and Kenneth B. Medlock III

Year: 2013
Volume: Volume 34
Number: Number 2
DOI: 10.5547/01956574.34.2.2
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Abstract:
Using data on 61 oil companies from 2001-09, we examine the evolution of revenue efficiency of National Oil Companies (NOCs) and shareholder-owned oil companies (SOCs). We find that NOCs generally are less efficient than SOCs, but their efficiency increased faster over the last decade. We also find evidence that partial privatizations increase operational efficiency, and (weaker) evidence that mergers and acquisitions during the decade tended to increase the efficiency of the merging firms. Finally, we find evidence that much of the inefficiency of NOCs is consistent with the hypothesis that government ownership leads to different firm objectives.





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