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The Privatization of Public Utilities

In this paper I take a hard look at both sides of the privatization of public utilities: the pro-academic, Washington Consensus side, and the pro-people side, to try to get to the bottom of whether privatization of public utilities provides any net benefit.

You can download the paper in PDF format here.

1 Background

2 Introduction

2.1 Why Privatize at All?

2.2 What makes Public Utilities Special?

3 What are the Economic Effects of Privatization?

3.1 Effect on the Industry: Efficiency Gains

3.2 Overall Effect on GDP

3.3 Fiscal Effect: Proceeds from Privatization

3.4 Growth

3.5 Productivity

3.6 Welfare

3.7 Labor and Employment

3.8 Income Distribution

4 Why the Opposition to Privatization of Public Utilities?

5 How Can We Improve the Privatization Process?

5.1 Improvements that Provide Economic Gains

5.2 Reforms to Address Inequality and the Poor

Lump Sum Redistribution and Taxation

Universal Service Clauses

5.3 Timing and Regulation: the Ukraine Case

5.4 Sequencing of Reforms

5.5 Corporate Governance

5.6 Competition

6 Conclusion


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