State Owned Enterprises

Materials  |  Audio  |  Poll  | Links to Principles of Democracy |   Resources


Should our democracy own and manage companies in key industries?

When Robert from California puts gasoline in his car, he pays almost five U.S. dollars per gallon. When Ana from Venezuela fills up, she pays only around 18 U.S. cents per gallon. Why is there such a big difference in gasoline prices in these two countries? The answer may lie in who owns and manages the oil companies.

Materials (pdf)

State Owned Enterprises — Lesson:






Links to Principles

The nature of democracy changes and grows along with its citizenry, but it’s always based on principles that help citizens modify, uphold, and strengthen their democracy. Visit the DDA Democratic Principles and Activities page to learn more about the principles underlying democracy and gain access to activities that help students understand the complexity of democracy. 

We’ve identified some democratic principles addressed in this lesson “Should our democracy allow national referendums?” What principles might you add to the list below?

Please click here for the pdf of the fourteen principles handout on our Democratic Principles & Activities page.

Economic Freedom

economicfreedomEconomic Freedom
People in a democracy must have some form of economic freedom. This means that the government allows some private ownership of property and businesses. People are allowed to choose their own work and to join labor unions. The role the government should play in the economy is debated, but it is generally accepted that free markets should exist in a democracy and the state (government) should not totally control the economy. Some people argue that the state should play a stronger role in countries where great inequality of wealth exists due to past discrimination or other unfair practices.

Rule of Law

ruleoflawThe Rule of Law
In a democracy, no one is above the law—not even a king, elected president, police officer, or member of the military. Everyone must obey the law and will be held accountable if they violate it. Democracy also insists that laws are equally, fairly, and consistently enforced.


Selected Resources

Associated Press, "Ecuador president imposes oil nationalization law," Bloomberg Business  Week (July 24, 2010), (accessed November 9, 2012).

Corral, Margarita, "Should Government Own Big Business and Industries? Views from the Americas." AmericasBarometer Insights: 2009 (No. 8), (accessed October 10, 2012).

Emery, Alex and John Quigley, "Peru's Humala Says He Won't Nationalize Gas Industry After Win," Bloomberg (June 9, 2011), (accesseed August 8, 2012).

Gupta, Girish, Leigh Montgomery, and Michail Vafeiadis, "World's Cheapest Gas: Top 10 Countries," The Christian Science Monitor (February 29, 2012), (accessed November 19, 2012).

Kahhat, Farid, "¿Por qué causa controversia llamar a ciertos sectores 'estratégicos'?" América Economia (November 29, 2011), (accessed October 9, 2012).

Kraus, Clifford and Simon Romero, "In Ecuador, Resentment of an Oil Company Oozes," The New York Times (May 14, 2009), November 9, 2012).

"Mixed Bag: SOEs are good at infrastructure projects, not so good at innovation," The Economist (January 21, 2012), (accessed November 7, 2012).

Musacchio, Aldo and Francisco Flores-Macias, "The Return of State-Owned Enterprises: Should we be afraid?" Harvard International Review (April 4, 2009), (accessed November 28, 2012).

Stanislaw, Joseph and Daniel Yergen, "Commanding Heights: The Battle for the World Economy," (Simon & Schuster, Inc., New York, NY, 1998).

"The 'State is back' in Latinamerica to lessen inequalities, says top UN official," MercoPress (October 17, 2012), (accessed November 30, 2012).

Weiner, Tim, "As National Oil Giant Struggles, Mexico Agonizes Over Opening It to Foreign Ventures," The New York Times (February 17, 2002), (accessed November 30, 2012).