The objectives of this paper is to examine the factors behind the formation and expansion of pupblic enterprises in Sri Lanka. The public enterprises which established before independence were maintained and expanded by the two major parties, the United National Party (UNP) and the Sri Lanka Freedom Party (SLFP) during the period 1948-77. These two parties had different party ideologies, but they were committed to maintain and to develop these ventures druing this era due to the influence of the Keynesian welfare state ideology. Meanwhile, this process has been reversed after 1977 due to the influence of a new state ideology, Market-oriented state ideology. This paper attempts to examine the role of the public-owned enterprises in post-independence Sri Lanka by employing the concept of the state ideology.
