Ownership, institutions and productivity of European electricity firms

Elisa Borghi, Chiara Del Bo and Massimo Florio

Departmental Working Papers from Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano

Abstract: Using firm-level balance-sheet data comparable across EU countries, we consider firms active in generation, distribution and transmission of electricity and their ownership structure to empirically investigate the interaction of public versus private ownership and the quality of institutions as determinants of productivity. While earlier literature has traditionally focused on ownership as an internal governance mechanism, and has suggested that public ownership is associated with lower productivity than under private ownership, here we focus on the role of institutions as an external governance mechanism. After controlling for size, wages, countries and sectors, we confirm that government-owned tend to be less productive than their private counterparts (a result robust to different productivity measures), but we also discover two new facts. First, when the control of the firm by government is indirect, i. e. when government ownership is at the top of the control chain, the negative productive effect is weaker. Second, this effect is smaller in countries with high-quality institutions and public enterprises are more efficient than in countries with a poor institutional environment

Keywords: Public ownership; electricity; productivity; institutions (search for similar items in EconPapers)
JEL-codes: D24 L32 L94 P48 (search for similar items in EconPapers)
Date: 2010-06-21
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://wp.demm.unimi.it/files/wp/2010/DEMM-2010_019wp.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mil:wpdepa:2010-19

Access Statistics for this paper

More papers in Departmental Working Papers from Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano Via Conservatorio 7, I-20122 Milan - Italy. Contact information at EDIRC.
Bibliographic data for series maintained by DEMM Working Papers ( this e-mail address is bad, please contact ).