nationalization

The process of bringing the assets of a business into the ownership of the state. Examples of industries nationalized in the past in the UK include the National Coal Board and British Rail. Historically, nationalization has been achieved through compulsory purchase, although this need not necessarily be the case. Nationalization has often been pursued as much for political as economic ends and the economic justifications themselves are varied. One argument for nationalization is that if a company possesses a natural monopoly, then it should not be run for private profit; another is that certain industries are strategically important for the nation. In the 1980s and 1990s Conservative governments reversed the nationalizations of the post-war Labour governments with a series of privatization measures, on the grounds that competition would increase efficiency and reduce prices. Even where this has arguably not proved to be the case, Labour administrations since 1997 have been reluctant to renationalize.