Private Participation and its Discontents: Insights from Large-Scale Surveys

Abstract

This paper investigates public attitudes toward product market regulation (PMR) reforms aimed at fostering private participation and competition in two network sectors—electricity and telecommunications. Despite the benefits of such reforms, including enhanced productivity and lower prices, they often face significant public resistance. We conduct large-scale surveys of 6,300 individuals in three emerging market and developing economies (Mexico, Morocco, and South Africa) to analyze the role of socioeconomic characteristics, beliefs, and perceptions in shaping support for PMR reforms. Our findings reveal that individual beliefs and perceptions, particularly those related to how policies work and market economy views, are major predictors of reform support. Randomized information treatments show that raising awareness about the costs of the status quo and the benefits of PMR reforms significantly increases public support. Among initially skeptical individuals, societal concerns play a larger role in respondents’ reasons for nonsupport, consistent with models of social preferences. However, offering tailored complementary and compensatory measures can further enhance support among those skeptical individuals.

Keywords: Product market reforms, political economy, perceptions, survey, experiment

JEL Classification: L51, D72, D78, D80, C93