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Does Privatization Deliver? Access to Telephone Services and Household Income in Poor Rural Areas Using a Quasi-Natural Experiment for Peru

Author

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  • Chong, Alberto E.
  • Galdo, Virgilio
  • Torero, Maximo

Abstract

We take advantage of a quasi-natural experiment in Peru by which the privatized telecommunications company was required by government to randomly install and operate public pay phones on small rural towns along the national territory. Using a especially designed household survey for a representative sample of rural towns we are able to link access to telephone services with household income. We find, that regardless of the income measurement, most characteristics of public telephone are positively linked with income. Remarkably, the benefits are given at both non-farm and farm income levels. Not only do the findings hold when using instrumental variables but they are further confirmed when using propensity scores matching methods.

Suggested Citation

  • Chong, Alberto E. & Galdo, Virgilio & Torero, Maximo, 2006. "Does Privatization Deliver? Access to Telephone Services and Household Income in Poor Rural Areas Using a Quasi-Natural Experiment for Peru," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25691, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae06:25691
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    References listed on IDEAS

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    More about this item

    Keywords

    Privatization; Institutions; Rural; Poverty; Telecommunications; Consumer/Household Economics; G32; H10; J45; O1;

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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