Reluctant regulation

Bernardo Bortolotti, Carlo Cambini and Laura Rondi

Journal of Comparative Economics, 2013, vol. 41, issue 3, 804-828

Abstract: We study the effect of state ownership on the market-to-book ratios of publicly traded European utilities from 1994 to 2005. We find that when the company is subject to independent regulation, state ownership seems positively associated with firm value. This relation tends to appear in countries where weak checks and balances and political fragmentation do not constrain the power of the executive. Our results suggest that, where political institutions are weak, politicians may influence regulatory agencies in order to benefit state-owned firms.

Keywords: Privatization; Regulatory independence; Political institutions; Firm value (search for similar items in EconPapers)
JEL-codes: G32 K23 L33 L51 L90 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (21)

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Working Paper: Reluctant Regulation (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:41:y:2013:i:3:p:804-828

DOI: 10.1016/j.jce.2012.12.003

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