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The Effects of Public Ownership and Regulatory Independence on Regulatory Outcomes

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  • Geoff Edwards

    ()

  • Leonard Waverman

    ()

Abstract

We examine the effects of public ownership and regulatory agency independence on regulatory outcomes in EU telecommunications. Specifically, we study regulated interconnect rates paid by entrants to incumbents. We find that public ownership of the incumbent positively affects these interconnect rates, and suggest that governments influence regulatory outcomes in favor of incumbents in which they are substantially invested. However, we also find that the presence of institutional features enhancing regulatory independence from the government mitigates this effect. In order to study regulatory independence, we introduce a new cross-country time-series database—the European Union Regulatory Institutions (EURI) Database. This database describes the development of institutions bearing on regulatory independence and quality in telecommunications in the 15 founding EU member states from 1997 to 2003 Copyright Springer Science+Business Media, Inc. 2006

Suggested Citation

  • Geoff Edwards & Leonard Waverman, 2006. "The Effects of Public Ownership and Regulatory Independence on Regulatory Outcomes," Journal of Regulatory Economics, Springer, vol. 29(1), pages 23-67, January.
  • Handle: RePEc:kap:regeco:v:29:y:2006:i:1:p:23-67 DOI: 10.1007/s11149-005-5125-x
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    References listed on IDEAS

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    1. Richard Green, 1999. "Checks and Balances in Utility Regulation The U.K. Experience," World Bank Other Operational Studies 11478, The World Bank.
    2. Oecd, 2000. "Telecommunications Regulations: Institutional structures and responsibilities," OECD Digital Economy Papers 48, OECD Publishing.
    3. Fink, Carsten & Mattoo, Aaditya & Rathindran, Randeep, 2003. "An assessment of telecommunications reform in developing countries," Information Economics and Policy, Elsevier, vol. 15(4), pages 443-466, December.
    4. Preetum Domah & Pollitt, M.G. & Jon Stern, 2002. "Modelling the Costs of Electricity Regulation: Evidence of Human Resource Constraints in Developing Countries," Cambridge Working Papers in Economics 0229, Faculty of Economics, University of Cambridge.
    5. Stern, J. & Cubbin, J., 2004. "Regulatory effectiveness: the impact of regulation and regulatory governance arrangements on electricity industry outcomes: a review paper," Working Papers 04/01, Department of Economics, City University London.
    6. Rauf Gönenç & Maria Maher & Giuseppe Nicoletti, 2003. "The Implementation and the Effects of Regulatory Reform: Past Experience and Current Issues," OECD Economic Studies, OECD Publishing, vol. 2001(1), pages 11-98.
    7. Jordi Gual & Francesc Trillas, 2003. "Telecommunications Policies: Determinants and Impact," Working Papers 2003/2, Institut d'Economia de Barcelona (IEB).
    8. Antonio Estache, 1997. "Designing Regulatory Institutions for Infrastructure-Lessons from Argentina," World Bank Other Operational Studies 11588, The World Bank.
    9. Peter L. Smith & Bjorn Wellenius, 1999. "Mitigating Regulatory Risk in Telecommunications," World Bank Other Operational Studies 11470, The World Bank.
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    More about this item

    Keywords

    European Union; European Union Regulatory Institutions (EURI) Database; interconnect rates; National Regulatory Authorities (NRAs); privatization; public ownership; regulatory independence; regulatory outcomes; telecommunications; H11; K23; L43; L96; O52; O57;

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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