International Coercion, Emulation and Policy Diffusion: Market-Oriented Infrastructure Reforms, 1977-1999
AbstractWhy do some countries adopt market-oriented reforms such as deregulation, privatization and liberalization of competition in their infrastructure industries while others do not? Why did the pace of adoption accelerate in the 1990s? Building on neo-institutional theory in sociology, we argue that the domestic adoption of market-oriented reforms is strongly influenced by international pressures of coercion and emulation. We find robust support for these arguments with an event-history analysis of the determinants of reform in the telecommunications and electricity sectors of as many as 205 countries and territories between 1977 and 1999. Our results also suggest that the coercive effect of multilateral lending from the IMF, the World Bank or Regional Development Banks is increasing over time, a finding that is consistent with anecdotal evidence that multilateral organizations have broadened the scope of the “conditionality” terms specifying market-oriented reforms imposed on borrowing countries. We discuss the possibility that, by pressuring countries into policy reform, cross-national coercion and emulation may not produce ideal outcomes.
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Bibliographic InfoPaper provided by William Davidson Institute at the University of Michigan in its series William Davidson Institute Working Papers Series with number 2004-713.
Length: 74 pages
Date of creation: 01 Jul 2004
Date of revision:
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Privatization; deregulation; liberalization; infrastructure; International Monetary Fund (IMF); World Bank; Multileral Institutions; Development; Reform; Globalization; Adoption; International;
Find related papers by JEL classification:
- O19 - Economic Development, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
- F02 - International Economics - - General - - - International Economic Order; Noneconomic International Organizations;; Economic Integration and Globalization: General
- F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission
- H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
- L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
- L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
- L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
- N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative
- P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
- C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-03-20 (All new papers)
- NEP-HIS-2005-03-20 (Business, Economic & Financial History)
- NEP-PBE-2005-03-20 (Public Economics)
- NEP-REG-2005-03-20 (Regulation)
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