Have Consumers Benefited from the Reforms in the Electricity Distribution Sector in Latin America?

34 Pages Posted: 20 Apr 2016

See all articles by Antonio Estache

Antonio Estache

Université Libre de Bruxelles (ULB) - European Center for Advanced Research in Economics and Statistics (ECARES)

Martin Rossi

University of San Andres

Date Written: September 28, 2004

Abstract

Estache and Rossi bring new empirical evidence on the impact of the choice of ownership and regulatory regime on firms' productivity and prices paid by consumers. They collect the evidence from a sample of electricity distribution companies in Latin America. The authors rely on estimations of labor and operation and maintenance (O&M) input requirement functions using alternative econometric approaches. Their main conclusions are:

- Private firms perform better (approximately 30 percent) than public firms. - The regulatory regimes matter, so that price-cap regulated firms do better than rate-of-return regulated firms, and firms regulated under hybrid regimes have intermediate performance. - Private firms operating under rate of return are at most as efficient as public firms. - There is no clear pattern of differences in electricity prices according to the regulatory regime. - Final prices fell in general but the drop did not match the productivity gains, implying that the operators and the state share some of the gains in the form of rents and higher tax revenue, respectively.

This paper - a product of the Office of the Vice President, Infrastructure Network - is part of a larger effort in the network to promote analytical work on emerging policy issues in infrastructure service delivery.

Suggested Citation

Estache, Antonio and Rossi, Martin, Have Consumers Benefited from the Reforms in the Electricity Distribution Sector in Latin America? (September 28, 2004). World Bank Policy Research Working Paper No. 3420. Available at SSRN: https://ssrn.com/abstract=625298

Antonio Estache (Contact Author)

Université Libre de Bruxelles (ULB) - European Center for Advanced Research in Economics and Statistics (ECARES) ( email )

Ave. Franklin D Roosevelt, 50 - C.P. 114
Brussels, B-1050
Belgium
32 (0)2 6503838 (Phone)

Martin Rossi

University of San Andres ( email )

Vita Dumas 284
(1644) Victoria, Pcia
Buenos Aires, Buenos Aires 1644
Argentina

Register to save articles to
your library

Register

Paper statistics

Downloads
137
Abstract Views
2,395
rank
210,580
PlumX Metrics