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Empirical evidence on the impact of privatization of fixed-line operators on telecommunications performance - Comparing OECD, Latin American, and African countries


  • Gasmi, Farid
  • Maingard, Alexis
  • Noumba Um, Paul
  • Recuero Virto, Laura


The aim of this paper is to highlight empirically some important worldwide differences in the impact of privatization of the fixed-line telecommunications operator on network expansion, tariffs, and efficiency during the 1985-2007 period for a large panel of countries. Our work suggests that the divergent results in the empirical literature on the performance of the privatization reform can be explained to a large extent by cross-regional heterogeneity. We find that the impact of privatization on outcomes is significantly positive in OECD and African resource scarce coastal countries, weakly positive in Latin American and the Caribbean countries, and strongly negative in African resource rich and African resource scarce landlocked countries. The results presented in this paper thus challenge the idea that there is a unique model of reform for infrastructure sectors that is equally applicable across regions and countries.

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  • Gasmi, Farid & Maingard, Alexis & Noumba Um, Paul & Recuero Virto, Laura, 2011. "Empirical evidence on the impact of privatization of fixed-line operators on telecommunications performance - Comparing OECD, Latin American, and African countries," IDEI Working Papers 660, Institut d'Économie Industrielle (IDEI), Toulouse.
  • Handle: RePEc:ide:wpaper:24155

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    References listed on IDEAS

    1. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
    2. Gutierrez, Luis Hernando, 2003. "The Effect of Endogenous Regulation on Telecommunications Expansion and Efficiency in Latin America," Journal of Regulatory Economics, Springer, vol. 23(3), pages 257-286, May.
    3. Ros, Agustin J. & Banerjee, Aniruddha, 2000. "Telecommunications privatization and tariff rebalancing: evidence from Latin America," Telecommunications Policy, Elsevier, vol. 24(3), pages 233-252, April.
    4. Gasmi, Farid & Recuero Virto, Laura, 2005. "Telecommunications Technologies: Deployment in Developing Countries," MPRA Paper 2443, University Library of Munich, Germany.
    5. Ndulu,Benno J. & O'Connell,Stephen A. & Bates,Robert H. & Collier,Paul & Soludo,Chukwuma C., 2009. "The Political Economy of Economic Growth in Africa, 1960–2000," Cambridge Books, Cambridge University Press, number 9780521127752, March.
    6. Li, Wei & Xu, Lixin Colin, 2004. "The Impact of Privatization and Competition in the Telecommunications Sector around the World," Journal of Law and Economics, University of Chicago Press, vol. 47(2), pages 395-430, October.
    7. Ros, Agustin J, 1999. "Does Ownership or Competition Matter? The Effects of Telecommunications Reform on Network Expansion and Efficiency," Journal of Regulatory Economics, Springer, vol. 15(1), pages 65-92, January.
    8. Wallsten, S.J., 2000. "Telecommunications Privatization in Developing Countries: The Real Effects of Exclusivity Periods," Papers 99-031, United Nations World Employment Programme-.
    9. Farid Gasmi & Paul Noumba Um & Laura Recuero Virto, 2009. "Political Accountability and Regulatory Performance in Infrastructure Industries: An Empirical Analysis," World Bank Economic Review, World Bank Group, vol. 23(3), pages 509-531, October.
    10. Bortolotti, Bernardo & Siniscalco, Domenico, 2004. "The Challenges of Privatization: An International Analysis," OUP Catalogue, Oxford University Press, number 9780199249343, June.
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    More about this item


    Privatization; Telecommunications;

    JEL classification:

    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • L98 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Government Policy
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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