externalization creates legal and managerial autonomy from politicians, which could potentially increase efficiency, as it safeguards the firm from political exploitation. However, corporatization can also fail to bring efficiency (or cause inefficiency), because this autonomy reduces the government's ability to monitor its management. Whether corporatization is beneficial may depend on the nature of the service that is corporatized, where autonomy may be less beneficial for more politicized and complex services. Step towards privatization or hybridization Although corporatization is to be distinguished from privatization (the former involves publicly owned corporations, the latter privately owned ones), once a service has been corporatised it is often relatively easy to privatise or part-privatise it, for example by selling some or all of the company's shares via the stock market. In some cases (e.g. the Netherlands in regard to water supply) there are laws to prevent this. Corporatization also can be a step towards the creation of hybrid forms of organization, such as institutional public-private partnerships or inter-municipal service organizations. Alleviate fiscal stress Corporatization is also a means to alleviate fiscal stress, as corporations can become standalone organizations that do not count towards municipalities' budgets. Prevalence Corporatization of state enterprises and collectively owned enterprises was a major component of the economic restructuring program of formerly communist nations, most notably the People's Republic of China. China's contemporary socialist market economy is based on a corporatized state sector where state companies are owned by the central government but managed in a semi-autonomous fashion. Corporatization has also been used in New Zealand and most states of Australia in the reform of their electricity markets, as well as in many other countries and industries (e.g. Dutch water supply companies). Major areas National level On a national scale, major areas of services which have been corporatized in the past include: National railroads, the initial impetus to corporatization of functions that had belonged to national and local governing bodies began in the sphere of national railroad construction in the mid-19th century. Corporatized highways, for example toll roads. Corporatized electricity Telecommunications Local level On a local scale, major areas of services which have been corporatized include: Corporatized water, for example, the Dutch water supply companies are publicly owned corporations (mostly by municipalities, but also by regional governments). For involvement of private corporations in water supply, see water industry and water privatization. Bus services Refuse collection Housing development State employment services Theaters and