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Determinants of successful electricity market reform

Author

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  • Erdogdu, Erkan

Abstract

The paper explores whether the question of why some countries are able to implement more extensive reforms is closely related to the question of why some countries have better institutions than others. We analyse this question by using empirical econometric models with cross-section data covering 51 countries. The results show that both the background of the regulator and the energy minister and the institutional endowments of a country are important determinants of how far reforms have gone in a country. Our results suggest that the best first chairman of a regulatory agency, in terms of reform progress, seems to be one with a degree in law or engineering and one with a long period in office. The best minister responsible for energy policy when regulator is set up is, on the other hand, one with a degree in business or economics and one who has as little experience in the electricity industry as possible and does not have a degree in law. The results also put forward that any improvement in the structure of the legal system, security of property rights, democracy or investment environment positively contributes to the reform progress in a country. However, there seems to be a negative relationship between reform progress and both civil liberties and political rights.

Suggested Citation

  • Erdogdu, Erkan, 2011. "Determinants of successful electricity market reform," MPRA Paper 38410, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:38410
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    File URL: https://mpra.ub.uni-muenchen.de/38410/1/MPRA_paper_38410.pdf
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    References listed on IDEAS

    as
    1. Erdogdu, Erkan, 2011. "The impact of power market reforms on electricity price-cost margins and cross-subsidy levels: A cross country panel data analysis," Energy Policy, Elsevier, vol. 39(3), pages 1080-1092, March.
    2. Littlechild, S.C. & Skerk, C.J., 2004. "Regulation of transmission expansion in Argentina Part I: State ownership, reform and the Fourth Line," Cambridge Working Papers in Economics 0464, Faculty of Economics, University of Cambridge.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Electricity market reform; new institutional economics; Poisson regression;

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities

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