The public sector represents a complex of economic objects, wholly or partially belonging to the central and local state bodies. The public sector existed in many countries long before development of capitalism, including mail, partially transport service, manufacturing of the weapon etc. On a measure forming systems of state regulation of economy the state built, redeemed at the private proprietors economic objects, mainly in sphere of an infrastructure, heavy industry, which functioning was always favourably and it is necessary for a national economy, but not always it is favourable from the point of view of the private capital.
In one country the public sector has arisen basically as a result of nationalisation of a number of branches and enterprises (in France, Italy, Great Britain, Austria), in others the state built or got ruined economic objects (in USA, Sweden, Japan). In the first group of the countries the share of public sector in national riches is higher, than in second.
Significant parts of public sector are objects of an infrastructure, in the majority unprofitable. Other part - the state enterprises in raw and power branches, where are required the large investments, and turnover of the capital slow. Profitability of state-owned firms, as a rule, below, than private. A part of public sector is packages of the actions of the mixed private-state companies.
The existence in conditions of a market economy of sectors, which in the activity is guided by principles a little bit distinguished from principles of private concerns, allows using public sector for the decision of nation-wide economic tasks, increasing money of a private enterprise.
The exclusive profit, and frequently and profit in general, is not the paramount purpose of activity of public sector in an infrastructure, power, raw branches, НИОКР, in preparation and retraining of the staff, in the field of protection of an environment, as high profits nobody requires of these spheres, and the losses become covered from the budget. Therefore public sector has become the supplier of cheap services (in particular, transport, mail-telegraphic), electric power and raw material, reducing, thus, costs in private sector.
The public sector as a means of state regulation of economy is actively used. So, in conditions of deterioration of a conjuncture, the depressions or crisis, when the private capital investments are reduced, investment in public sector, as a rule, grow. Thus, the governmental bodies aspire to counteract recession of manufacture and growth of unemployment. The public sector plays an appreciable role in state structural politics. The state creates new objects or expands and reconstructs old in those spheres of activity, branches or regions, where the private capital connected is not enough. So, the public sector plays a huge role in economy, preparation and retraining of the staff. The state-owned firms are engaged also in foreign trade, export of the capital abroad, frequently acting by the pioneers in introduction of the national capital in any country (for example, participation of the German concern “ Volkswagen ”, federal taking place in property federal and ground governments, in motor industry of Czech).
In the whole public sector serves addition of a private enterprise there and such measure, where and as far as the motivation for the private capital appears insufficient. In result the public sector serves to increase of efficiency of a national economy as a whole and is one of tools of redistribution of a total internal product (the complete internal product is a cumulative cost of production of sphere of material manufacture and spheres of services, irrespective of a national accessory of the enterprises located in territory of the given country).
The sizes of public sector, its share in national economy, change not only as a result of new construction and purchase, but also as a consequence of a privatisation - sale profitable, reconstructed objects of public sector to the private capital. In 80-th and 90-th years this tendency appreciably has amplified.
Alongside with the listed tools of state regulation of economy having internal economy the orientation, an arsenal of means of the external economic regulation exists.
Practically all levers of influence on process of reproduction inside the country render essential influence on foreign economic relations: change of the registration rate, taxation new privileges and grants on the investment in a fixed capital etc.