Nationalization is best defined as:

Nationalization refers to the process in which a government takes control of private industry or assets, transferring them from private ownership to public ownership. This often occurs in sectors deemed essential for the functioning of the economy or to ensure that they serve the public interest.

The correct choice captures this definition accurately, as it highlights the fundamental nature of nationalization: the shift from private entities to government control. This can happen for various reasons, including economic security, social equity, or political strategy.

The other options do not align with the definition of nationalization. Promoting private industry relates to encouraging entrepreneurial activities, which is contrary to the concept of nationalization. Selling public assets to improve economic efficiency suggests a shift from public to private ownership, opposite to nationalization's intent. Finally, improving government services through competition does not directly address the transfer of ownership but focuses on management strategies within the public sector. Each of these alternative choices emphasizes different economic principles that diverge from the core concept of nationalization.