Regulation and Private Sector Investment in Infrastructure : Evidence from Latin America
The author assesses the importance of the regulatory framework as a determinant of private sector investment in infrastructure. She uses recently compiled data on private and public sector investment in the water, power, telecommunications, railroa...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2003/04/2329630/regulation-private-sector-investment-infrastructure-evidence-latin-america http://hdl.handle.net/10986/18269 |
| Summary: | The author assesses the importance of
the regulatory framework as a determinant of private sector
investment in infrastructure. She uses recently compiled
data on private and public sector investment in the water,
power, telecommunications, railroads, and roads sectors
between 1980 and 1998 in nine countries in Latin America.
The author finds that the most significant institutional
determinant of private investment volumes is the passage of
legislation liberalizing the investment regime. This is
important because it indicates that the legal basis for
reform is probably more critical in determining the quality
of the investment climate than specific aspects of the
institutional framework governing private sector
participation. In accordance with intuition, the
author's results indicate that government action to
increase regulatory certainty and minimize the perceived
risk of expropriation through the establishment of
independent regulatory bodies is a critical determinant of
the volume of private investment flows. She also finds that
the general relationship of private to public investment is
one of substitutability. |
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