Because of the diverse forms of state-owned enterprises (SOEs), scholars still differ considerably over basic issues concerning their behavior. More agreement is possible, however, when a relatively homogeneous subset of state enterprises can be studied. Comparative analysis of Air France and of a state-owned agricultural enterprise in Cuba would probably offer little in the way of useful generalizations; it makes more sense to build up hypotheses from cases that are more likely to have commonalities. This chapter examines, through detailed case studies, two similar state-owned conglomerates in Venezuela and Brazil, the Corporaci6n Venezolana de Guayana (CVG) and the Companhia Vale do Rio Doce (CVRD), and constructs a model for analyzing the kind of behavior found to be typical in both.

Comparability of CVG and CVRD: a short description

As state-owned enterprises go, CVG and CVRD have significant similarities that provide a rich field for comparison. CVG was founded in 1960 as a regional development corporation whose ambit included the huge southeastern portion of Venezuela, at the time largely empty and backward, although blessed with important mineral and energy resources. CVG's original mandate was threefold: direct the nascent steel industry, build up the hydroelectric facilities in the area, and provide the human and physical infrastructure not only for these two industries but also for the development of new industries in Guayana.