privatisation in developing countries a review of the evidence and the policy lessons privatisation is widely promoted as a means of improving economic performance in developing countries however the policy remains controversial and the relative roles of ownership and other structural changes such as competition and regulation in promoting economic performance remain uncertain this article reviews the main empirical evidence on the impact of privatisation on economic performance in developing economies the evidence suggests that if privatisation is to improve performance over the longer term it needs to be complemented by policies that promote competition and effective state regulation and that privatisation works best in developing countries when it is integrated into a broader process of structural reform

nonlinear nonparametric nonessential exchange rate estimation a wide variety of empirical exchange rate mo dels have been estimated over the years but despite the considerable energies that have been devoted to this work the economics profession has remarkably little to show for itself there is little evidence that conclusively links the bilateral exchange rates of typical oecd countries to fundamental macroeconomic determinants of exchange rates such as money output relative prices or interest differentials coefficient estimates are notoriously unstable and frequently mis signed compared with theoretical predictions exchange rate equations do not fit particularly well and forecast no better than the simplest naive alternatives recently a new class of exchange rate models was introduced by paul krugman 1988 these models provide a potential reason for the poor performance of traditional exchange rate models because they are nonlinear if the exchange rate actually depends in a nonlinear way on exogenous macroeconomic fundamentals linear exchange rate models may work poorly even though the exchange rate is closely linked to fundamentals in this paper we provide a brief sketch of some of this work as well as some preliminary evidence on the actual performance of these nonlinear models in our empirical analysis we use a nonparametric estimator that can handle a wide variety of nonlinear phenomena we examine fixed exchange rate regimes where nonlinearities should be quite easy to detect however we do not find strong empirical support for the hypothesis that the incorporation of nonlinear effects significantly improves models of exchange rate determination in section i we briefly review the theoretical literature on nonlinear target zone exchange rate models linking this work to the tests for intrinsic bubbles we draw heavily on recent papers by kenneth froot and maurice obstfeld 1989a b our methodology and data are discussed in section ii section iii contains new empirical tests for nonlinearities in exchange rate models

the efficiency of state owned and privatized firms does ownership make a difference abstract this paper compares the pre and post privatization efficiency of a sample of state owned enterprises privatized in spain with the efficiency of their closest private competitors we perform a two stage double bootstrap data envelopment analysis model in the first stage the efficiency is estimated through a bootstrapped data envelopment analysis and then followed in the second stage by a bootstrapped truncated regression our results provide evidence that i there were no significant differences in efficiency between the state owned enterprises and their private counterparts before privatization and ii the efficiency of newly privatized firms significantly increased after their privatization while private competitors showed no significant improvement during the same post privatization period

electricity planning and implementation in sub saharan africa a systematic review abstract universal electricity access is an important development objective and the focus of a number of key global un initiatives while robust electricity planning is widely believed to be a prerequisite for effective electrification to date no comprehensive overview of electricity planning research has been undertaken on sub saharan africa the world region with the lowest access rates this paper reviews quantitative and qualitative electricity planning and related implementation research considering each of the 49 sub saharan african countries the four regional power pools and the sub continent as a whole applying a broad understanding of electricity planning and a practical limit of 20 reviewed articles per country and region 306 relevant peer reviewed journal articles are included in this review a general classification scheme is introduced that classifies the planning literature along the addressed value chain depth number of different analysed criteria and number of evaluated decision alternatives the literature is found to be strongly clustered in a few countries with less than 5 identified relevant articles in 36 of the 49 countries the total amount of articles per year is clearly increasing over time addressing technology choice operation distribution and implementation analyses although including different high level criteria in analysing electricity systems is common the literature is only starting to use formalised multi criteria decision making mcdm tools the review indicates that 63 of relevant articles favour renewable energy technologies for their given problems frequently mentioned success factors for electrification in sub saharan africa include adequate policy design sufficient finance and favourable political conditions while considerable regional and methodological literature gaps are apparent the literature in this review identifies a rich and fruitful ground for future research to fill these gaps

testing the limits of privatization argentine railroads abstract just how far can privatization be pushed and with what consequences based on a study of argentine railroads this paper concludes that even large unprofitable firms in developing countries faced with market failures can be privatized but the gains from doing so depend on how badly the state enterprise was performing to begin with and the potential for introducing competition in the market and for the market the broader lesson is that when both market failures and government failures are present a public private solution is preferable to a purely private or a purely public solution privatization is not a panacea but potentially a palliative when it comes to reducing subsidies or coping with regulatory failures

productive efficiency of public enterprises a macroeconomic analysis based on cross section estimation of a neoclassical production function over the past decade the role of public enterprise in the economic development process has been a subject of active debate using cross section estimates of a neoclassical production function incorporating vakue addition of the parasatal sector as a variable supplementary to the factors and capital it is shown onthe basis of macroeconomic data for the periods 1970 81and 1970 85 that hypothesis derived fromm the propely rights bureaucracy and x inefficiency cannot be rejected

how investor portfolios shape regulatory outcomes privatized infrastructure after crises summary many developing countries privatized utilities during the 1990s their weak institutional environments however make them prone to crises that generate incentives for governments to renege on contractual commitments to investors to understand variation in post crisis regulatory outcomes in such contexts scholars must consider investors prior choices regarding portfolio structure investors facing high reputational costs from exit are more likely to remain following expropriation and those holding diverse assets in their contract jurisdiction to secure compensation these factors account for significant unexplained within sector and subnational variation for which we provide qualitative and quantitative evidence from argentina s water and electricity sectors following the 2001 crisis

power sector reform in developing countries mismatched agendas power sector reform is rapidly spreading across all corners of the developing world at an alarmingly rapid pace while the rationales for reform seem to have gained acceptance among the stakeholders the reform model and process are contested this paper examines the impacts of reform using the promised outcomes as a basis for analysis the ability of reform to meet the developmental challenges facing the reformers is explored it concludes that reform has had some achievements if conventional performance indicators are used but also questions the validity of some of these indicators reform has however not fulfilled many of its goals and the prevailing recipes are likely to leave developing countries socially and economically worse off than in the pre reform period progressive government intervention is needed to shift reform process towards a more responsible development path

organizational economics and institutions as missing elements in economic development analysis abstract the main objective of this paper is to apply x efficiency theory to the analysis of organizations and state enterprises with special reference to developing countries in particular the black box relating to the internal operation of organizations is opened up to understand better the decision mechanisms operating within firms and institutions intrafirm conventions are explored as they relate to the impact of external and internal pressures on the decision making process implications are drawn to improve the internal efficiency of institutions in developing countries

privatization technical efficiency and welfare consequences the case of the cote d ivoire electricity company cie abstract in 1990 cote d ivoire privatized the management of its electric power company lease contracting in this paper we are interested in identifying the economic effect of this institutional change by estimating a stochastic production frontier we have found that productive efficiency improved after privatization thanks to organizational innovations total factor productivity gains have been closely associated with a cost reduction strategy the way these gains have been distributed in a monopoly context suggests that consumers have been the main beneficiaries through a significant decrease of the relative price of electricity

technical efficiency measurement within the manufacturing sector in cote d ivoire a stochastic frontier approach this article analyses the productive performance in four manufacturing sectors of the ivorian economy textiles and garments metal products food processing wood and furniture to appraise the productive performance econometric production frontier models are estimated illustrating the maximum output attainable from a given quantity of inputs the frontier and firm efficiency scores are derived from stochastic production functions estimated on cross sectional data the stochastic specification of the models allows for the decomposition of the error term into two components one the normal random effect and the other to account for technical inefficiency that we explain by various exogenous variables describing the economic and institutional environment firm size proves to be a statistically significant determinant of the productive performance across the four sectors the positive impact of being large compensates the negative effect of a formal institutional status in an environment where government

a theory of yardstick competition in the typical regulatory scheme a franchised monopoly has little incentive to reduce costs this article proposes a mechanism in which the price the regulatedfirm receives depends on the costs of identical firms in equilibrium each firm chooses a socially efficient level of cost reduction the mechanism generalizes to cover heterogeneous firms with observable differences medicare s prospective reimbursement of hospitals by using diagnostically related groups is a scheme very similar to the one outlined here

total factor productivity growth technological progress and technical efficiency change dimensions of productivity change in yugoslavia 1965 1978 this article total factor productivity growth technological progress and technical efficiency change dimensions of productivity change in yugoslavia 1965 78 was reprinted with permission from the december 1982 issue of the economic journal this article proposes a methodology that decomposes total factor productivity change into two distinct elements technological progress and changes in technical efficiency technological progress is defined as the change in the best practice production frontier all other productivity change is attributed to technical efficiency change the article provides a theoretical framework for decomposing total factor productivity growth as well as a specification and estimation of the deterministic frontier production function it employs a programming technique to estimate a flexible functional form of the production frontier the paper then applies this technique to empirical data from yugoslavia of the period from 1965 to 1978 it concludes that for yugoslavia improvements to technical efficiency comprise the dominant contribution to total factor productivity change this agrees with accumulating evidence that in many developing economies productivity gain due to technological mastery of imported technology is substantial

how efficient are african electricity companies evidence from the southern african countries this paper is a first attempt at documenting efficiency levels in africa s electricity firms their evolution and the sources of this evolution the analysis is based on a sample of 12 operators providing services in the 12 country members of the southern africa power pool we focus on the changes in total factor productivity tfp of the largest operators in each country between 1998 and 2005 we then rely on a data envelopment analysis dea decomposition to identify the sources of the changes in tfp the results suggest fairly comparable levels of efficiency in the region and performance levels and evolution quite independent of the degree of vertical integration the presence of a private actor or the main sources of energy supply the analysis suggest that although the companies have not made significant improvements during the period of analysis in using their capital and human assets they have done much better in adopting better technologies and better commercial practices no clear correlation could be associated with the adoption of reforms during the last decade and data limitations impede a more refined assessment of the impact of reforms on efficiency at this stage

scale factor intensity and efficiency an empirical study of the chinese coal industry this paper deals with the interrelationship among firm scale factor intensity and efficiency using the chinese industrial survey data in 1985 and stochastic frontier models according to empirical

threshold cointegration and causality relationship between energy use and growth in seven african countries abstract the paper investigates the long run and the causality relationship between energy consumption and economic growth for seven sub saharan african countries during the period 1970 2007 using the gregory and hansen 1996a 1996b testing approach to threshold cointegration we find that energy consumption is cointegrated with economic growth in cameroon cote d ivoire ghana nigeria and south africa moreover this test suggests that economic growth has a significant positive long run impact on energy consumption in these countries before 1988 and this effect becomes negative after 1988 in ghana and south africa furthermore causality tests suggest bidirectional causality between energy consumption and real gdp in cote d ivoire and unidirectional causality running from real gdp to energy usage in the case of congo and ghana

the measurement and sources of technical inefficiency in the indonesian weaving industry production function models are estimated with a time series of cross section data on indonesian weaving establishments the sources of technical inefficiency are investigated three firm attributes are identified as being potentially related to firm efhciency tbey are firm ownership age and size the importance of these attributes as sources of inefficiency in the indonesian weaving industry is investigated and the implications of the find ings discussed

privatization and economic growth an empirical investigation from a sample of developing market economies this paper explores the economic determinants of privatization programmes and the macroeconomic impact of this institutional reform on the growth rate of the gdp a sample of thirty five developing market economies is considered over the 1988 92 period probit and tobit models are used to identify the determinants of successful privatization programmes then regressions are run where probabilities probit and expected values tobit are successively included as additional regressors beside the potential influence of other economic policy variables a significant positive effect is highlighted giving evidence of the importance of divestiture the economic effect is found to be stronger when this institutional reform took place in industry or infrastructure

target zones and forward rates in a model with repeated realignments abstract this paper studies the term structure of forward premia in a target zone with imperfect credibility the relationship between spot and forward exchange rates which reflects the possibility of realignments of the band is studied for various intervention policies with different degrees of credibility forward market data is used to estimate the implied credibility of the french german target zone during the ems parameter estimates accord with the experience of the ff dm exchange rate during the 1980s although spot exchange rates display little sensitivity to anticipated intervention forward data can be used to detect the effects of intervention on exchange rate dynamics