The Pitfalls of Water Privatization: Failure and Reform in Malaysia
This paper examines why private participation in infrastructure (PPI) in water continues to be promoted despite poor results in developing countries. It argues that the main characteristics of infrastructure discourage private investment and necessitate state subsidies which dilute private risks and incentives and facilitate rent-seeking. As a result, PPI is characterized by public financing, selective private investments and inconclusive efficiency gains. This is reflected globally and in Malaysia where PPI continues to be promoted because it provides captive rents. The political factors that drive PPI invariably compromise institutional solutions as Malaysia’s water sector reforms illustrate.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- David Parker & Colin Kirkpatrick, 2005.
"Privatisation in Developing Countries: A Review of the Evidence and the Policy Lessons,"
Journal of Development Studies,
Taylor & Francis Journals, vol. 41(4), pages 513-541.
- Parker, David & Kirkpatrick, Colin, 2003. "Privatisation in Developing Countries: A Review of the Evidence and the Policy Lessons," Centre on Regulation and Competition (CRC) Working papers 30623, University of Manchester, Institute for Development Policy and Management (IDPM).
- Benitez Daniel & Estache Antonio, 2005.
"How Concentrated are Global Infrastructure Markets?,"
Review of Network Economics,
De Gruyter, vol. 4(3), pages 1-23, September.
- Antonio Estache & D. Benitez, 2005. "How concentrated are global infrastructure markets?," ULB Institutional Repository 2013/43970, ULB -- Universite Libre de Bruxelles.
- Benitez, Daniel & Estache, Antonio, 2005. "How concentrated are global infrastructure markets?," Policy Research Working Paper Series 3513, The World Bank.
- J. Luis Guasch, 2004. "Granting and Renegotiating Infrastructure Concessions : Doing it Right," World Bank Publications, The World Bank, number 15024.
- Michael Keating, 2008. "Infrastructure: What Is Needed and How Do We Pay for It?," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 41(3), pages 231-238, 09.
- Rasiah, Rajah & Shari, Ishak, 2001. "Market, Government and Malaysia's New Economic Policy," Cambridge Journal of Economics, Oxford University Press, vol. 25(1), pages 57-78, January.
- Dieter Helm & Tom Tindall, 2009. "The evolution of infrastructure and utility ownership and its implications," Oxford Review of Economic Policy, Oxford University Press, vol. 25(3), pages 411-434, Autumn.
- Antonio Estache & M.E. Pinglo, 2005.
"Are Returns to Private Infrastructure in Developing Countries Consistent with Risks since the Asian Crisis,"
ULB Institutional Repository
2013/44150, ULB -- Universite Libre de Bruxelles.
- A. Estache & M.E. Pinglo, 2005. "Are returns to private infrastructure in developing countries consistent with risks since the Asian crisis?," Competition and Regulation in Network Industries, Intersentia, vol. 6(1), pages 47-75, September.
- Estache, Antonio & Pinglo, Maria Elena, 2004. "Are returns to private infrastructure in developing countries consistent with risks since the Asian crisis?," Policy Research Working Paper Series 3373, The World Bank.
- Werner Baer & Gabriel Montes-Rojas, 2008. "From Privatization to Re-nationalization: What went Wrong with Privatizations in Argentina?," Oxford Development Studies, Taylor & Francis Journals, vol. 36(3), pages 323-337.
- Bent Flyvbjerg, 2009.
"Survival of the unfittest: why the worst infrastructure gets built--and what we can do about it,"
Oxford Review of Economic Policy,
Oxford University Press, vol. 25(3), pages 344-367, Autumn.
- Bent Flyvbjerg, 2013. "Survival of the Unfittest: Why the Worst Infrastructure Gets Built, And What We Can Do about It," Papers 1303.6571, arXiv.org.
- Estache, Antonio & Fay, Marianne, 2007. "Current debates on infrastructure policy," Policy Research Working Paper Series 4410, The World Bank.
- Foster, Vivien & Yepes, Tito, 2006. "Is cost recovery a feasible objective for water and electricity ? The Latin American experience," Policy Research Working Paper Series 3943, The World Bank.
- Paul Cook & Yuichiro Uchida, 2008. "The Performance of Privatised Enterprises in Developing Countries," Journal of Development Studies, Taylor & Francis Journals, vol. 44(9), pages 1342-1353.
- Annez, Patricia Clarke, 2006. "Urban infrastructure finance from private operators : what have we learned from recent experience ?," Policy Research Working Paper Series 4045, The World Bank.
- Ioannis N. Kessides, 2004. "Reforming Infrastructure : Privatization, Regulation, and Competition," World Bank Publications, The World Bank, number 13525.
- Engelbert Stockhammer, 2004.
"Financialisation and the slowdown of accumulation,"
Cambridge Journal of Economics,
Oxford University Press, vol. 28(5), pages 719-741, September.
- repec:cup:cbooks:9780521549486 is not listed on IDEAS
- Estache, Antonio & Iimi, Atsushi, 2008.
"Procurement efficiency for infrastructure development and financial needs reassessed,"
Policy Research Working Paper Series
4662, The World Bank.
- Antonio Estache & A. Iimi, 2008. "Procurement Efficiency for Infrastructure Development and Financial Needs Reassessed," Working Papers ECARES 2008_022, ULB -- Universite Libre de Bruxelles.
- Jeff Tan, 2011. "Infrastructure Privatisation: Oversold, Misunderstood and Inappropriate," Development Policy Review, Overseas Development Institute, vol. 29(1), pages 47-74, 01.
- Kristin Komives & Vivien Foster & Jonathan Halpern & Quentin Wodon, 2005.
"Water, Electricity, and the Poor : Who Benefits from Utility Subsidies?,"
World Bank Publications,
The World Bank, number 6361.
- Kristin Komives & Vivien Foster & Jonathan Halpern & Quentin Wodon & Roohi Abdullah, 2008. "Water, Electricity, and the Poor : Who Benefits from Utility Subsidies?," World Bank Other Operational Studies 11745, The World Bank.
- Antonio Estache, 2001. "Privatization and Regulation of Transport Infrastructure in the 1990s'," ULB Institutional Repository 2013/43998, ULB -- Universite Libre de Bruxelles.
- Martimort, David & Straub, Stéphane, 2009. "Infrastructure privatization and changes in corruption patterns: The roots of public discontent," Journal of Development Economics, Elsevier, vol. 90(1), pages 69-84, September.
- Antonio Estache & André De Palma & E. Quinet & R. Vickerman, .
"Public-Private Partnerships in Transport,"
ULB Institutional Repository
2013/44020, ULB -- Universite Libre de Bruxelles.
- Ioannis N. Kessides, 2005. "Infrastructure Privatization and Regulation: Promises and Perils," World Bank Research Observer, World Bank Group, vol. 20(1), pages 81-108.
- repec:cup:cbooks:9780521840187 is not listed on IDEAS
- Joseph E. Stiglitz, 1996. "Whither Socialism?," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262691825, August.
- Morag I. Torrance, 2008. "Forging Glocal Governance? Urban Infrastructures as Networked Financial Products," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 32(1), pages 1-21, 03.
- Morag I. Torrance, 2007. "The Power of Governance in Financial Relationships: Governing Tensions in Exotic Infrastructure Territory," Growth and Change, Wiley Blackwell, vol. 38(4), pages 671-695.
- John Vickers & George Yarrow, 1991. "Economic Perspectives on Privatization," Journal of Economic Perspectives, American Economic Association, vol. 5(2), pages 111-132, Spring.
- Clive Harris, 2003. "Private Participation in Infrastructure in Developing Countries : Trends, Impacts, and Policy Lessons," World Bank Publications, The World Bank, number 15124.
- Briceno-Garmendia, Cecilia & Estache, Antonio & Shafik, Nemat, 2004. "Infrastructure services in developing countries : access, quality, costs and policy reform," Policy Research Working Paper Series 3468, The World Bank.
- David E. M. Sappington & Joseph E. Stiglitz, 1987.
"Privatization, information and incentives,"
Journal of Policy Analysis and Management,
John Wiley & Sons, Ltd., vol. 6(4), pages 567-585.
- Timothy C. Irwin, 2007. "Government Guarantees : Allocating and Valuing Risk in Privately Financed Infrastructure Projects," World Bank Publications, The World Bank, number 6638.
When requesting a correction, please mention this item's handle: RePEc:eee:wdevel:v:40:y:2012:i:12:p:2552-2563. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.