Governments may "bail out" poorly run businesses with money when, economically, it may be better to let the business fold.

Nationalized industries can be prone to interference from politicians for political or populist reasons. Such as, for example, making an industry buy supplies from local producers, when that may be more expensive than buying from abroad, forcing an industry to freeze its prices/fares to satisfy the electorate or control inflation, increasing its staffing to reduce unemployment, or moving its operations to marginal constituencies; it is argued that such measures can cause nationalized industries to become uneconomic and uncompetitive.

The government may only be interested in improving a company in cases when the performance of the company becomes politically sensitive.

The government may put off improvements due to political sensitivity — even in cases of companies that are run well.

The company may become prone to corruption; company employees may be selected for political reasons rather than business ones.

The government may seek to run a company for social goals rather than business ones (this is conversely seen as a negative effect by critics of privatization).

It is claimed by supporters of privatization, that privately-held companies can more easily raise capital in the financial markets than publicly-owned ones.

Parts of a business which persistently lose money are more likely to be shut down in a private business.

Privatization will not result in true competition if a natural monopoly exists.

In cases where public services or utilities are privatized, this can create a conflict of interest between profit and maintaining a sufficient service. A private company may be tempted to cut back on maintenance or staff training etc, to maximize profits.

Private companies do not have any goal other than to maximize profit.

Nationalized industries are usually guaranteed against bankruptcy by the state. They can therefore borrow money at a lower interest rate to reflect the lower risk of loan default to the lender. This does not apply to private industries.

A public service may provide public goods that, while important, are of little market value, such as the cultural goods produced by public television and radio.

A centralized enterprise is generally more cost effective than multiple smaller ones. Therefore splitting up a public company into smaller private chunks will reduce efficiency.

Buyers of public property have often, most notably in Russia, used insider positions to enrich themselves - and civil servants in the selling positions - grossly.

The public does not have any control or oversight of private companies.

If a government-owned company providing an essential service (such as water supply) to all citizens is privatized, its new owner(s) could stop providing this service to those who are too poor to pay, or to regions where this service is unprofitable.

Profits from successful enterprises end up in private pockets instead of being available for the common good.

Public services are per definition low-risk ventures that don't need scarce risk capital that is needed better elsewhere.