Is Voucher Privatization Good?

Question

I've been reading on voucher privatization, and it seems like a mix between capitalism and socialism. I don't totally understand it, but I want to know what everyone else thinks of it.

Answer 1

Voucher privatization is a method of mass privatization of state-owned assets used throughout the former Soviet Union and Eastern Europe in the 1990s.  In voucher privatization, vouchers are distributed to the population for free or a nominal fee.  

Arguments against voucher privatization included the view that it failed to raise significant revenue for the state (as opposed to selling firms to the highest bidder); did not create the means for the injection of new capital, management and technology into privatize firms; diffused ownership too widely and thus weakened corporate governance of firms; created greater opportunities for "insider privatization," whereby old enterprise directors could gain control over the majority of shares in their firm.  Voucher privatization also gave rise to investment funds that used vouchers to gain control over firms and strip them of their assets, leaving the shareholders with a worthless firm while the investment fund profited. In other cases, investment funds were owned by banks that were themselves still state property, meaning that assets went from state hands to the public and then back to the state.