Privatizing Monopolies in Developing Countries: The Real Effects of Exclusivity Periods in Telecommunications

Scott Wallsten ()

Journal of Regulatory Economics, 2004, vol. 26, issue 3, 303-320

Abstract: Many developing countries have given newly privatized incumbent network utilities, especially telecommunications, exclusive rights to serve particular markets. Research to date has explored privatization, competition, and to a lesser extent, regulation. We know little, however, about the effects of the privatization transactions themselves and, in particular, how these ‘‘exclusivity periods’’ matter. I use original data to investigate this approach to privatization. I find that exclusivity periods are associated with significant increases in the firm’s sale price. Exclusivity periods are also, however, correlated with a significant decrease in the incumbent’s investment in the telecommunications network, payphones, mobile telephone penetration, and international calling. Copyright Kluwer Academic Publishers 2004

Keywords: privatization; regulation; telecommunications; developing countries (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (19)

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DOI: 10.1007/s11149-004-7553-4

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