Differences between Private Enterprise and Public Enterprise

Private enterprise isn't established by an act of parliament, while public enterprise is established by an act of parliament.

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A private enterprise is a type of business owned and operated by private individuals or groups. This enterprise aims to generate profits. It is typically driven by market demands and competitive forces.

A public enterprise, on the other hand, is a business or organization that is owned and operated by the government. Its primary goal might not solely be profit but could also include providing essential services or fulfilling specific social or economic objectives. Public enterprises operate in a number of industries, including energy, healthcare, and transportation.

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Photo by Erol Ahmed on Unsplash

Differences between Private Enterprise and Public Enterprise

  1. Private enterprise is owned by individuals, while public enterprise is owned by the government or state.
  2. Private enterprise isn’t established by an act of parliament, while public enterprise is established by an act of parliament.
  3. Private enterprise derives its capital from individuals, while public enterprise’s capital is provided by the government.
  4. In private enterprise, profit-making is the motive for its establishment, while in public enterprise, profit-making is not the main motive.
  5. Private enterprise is controlled by individual owners, while public enterprise is controlled by directors.
  6. Owners bear the financial loss in private enterprises, while the financial loss incurred in public enterprises is borne by taxpayers.
  7. Private enterprise does not enjoy a monopoly, while public enterprise often enjoys a monopoly.
  8. Services in private enterprise are not restricted, while services in public enterprise are often restricted.
  9. Private enterprise involves less capital in establishment and running, while public enterprise involves more capital.
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