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Infrastructure performance and reform in developing and transition economies: evidence from a survey of productivity measures

  • Estache, Antonio
  • Perelman, Sergio
  • Trujillo, Lourdes

The authors review about 80 studies on electricity and gas, water and sanitation, and rail and ports (with a footnote on telecommunications) in developing countries. The main policy lesson is that there is a difference in the relevance of ownership for efficiency between utilities and transport in developing countries. In transport, private operators have tended to perform better than public operators. For utilities, ownership often does not matter as much as sometimes argued. Most cross-country studies find no statistically significant difference in efficiency scores between public and private providers. As for the country-specific studies, some do find differences in performance over time but these differences tend to matter much less than a large number of other variables. Across sectors, private operators functioning in a competitive environment or regulated under price caps or hybrid regulatory regimes tend to catch up best practice faster than public operators. There is a very strong case to push regulators in developing and transition economies toward a more systematic reliance on yardstick competition in a sector in which residual monopoly powers tend to be common.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3514.

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Date of creation: 01 Feb 2005
Date of revision:
Handle: RePEc:wbk:wbrwps:3514
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  1. Ligia Melo B. & Nestor Espinosa, . "Ineficiencia en la Distribución de Energía Eléctrica: Una Aplicación de las Funciones de Distancia Estocástica," Borradores de Economia 321, Banco de la Republica de Colombia.
  2. Filippini, Massimo & Hrovatin, Nevenka & Zoric, Jelena, 2004. "Efficiency and regulation of the Slovenian electricity distribution companies," Energy Policy, Elsevier, vol. 32(3), pages 335-344, February.
  3. Rodríguez Pardina, Martín & Rossi, Martín & Ruzzier, Christian, 1999. "Fronteras de eficiencia en el sector de distribución de energía eléctrica: la experiencia sudamericana," UADE Textos de Discusión 15_1999, Instituto de Economía, Universidad Argentina de la Empresa.
  4. Rodríguez Pardina, Martín A. & Rossi, Martín, 2000. "Technical Change and Catching-up: The Electricity Distribution Sector in South America," UADE Working Papers 11_2000, Instituto de Economía, Universidad Argentina de la Empresa.
  5. Tupper, Henrique Cesar & Resende, Marcelo, 2004. "Efficiency and regulatory issues in the Brazilian water and sewage sector: an empirical study," Utilities Policy, Elsevier, vol. 12(1), pages 29-40, March.
  6. Bagdadioglu, Necmiddin & Waddams Price, Catherine M. & Weyman-Jones, Thomas G., 1996. "Efficiency and ownership in electricity distribution: A non-parametric model of the Turkish experience," Energy Economics, Elsevier, vol. 18(1-2), pages 1-23, April.
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