of the distribution of electricity and water, in particular for Latin American Countries, there is no comprehensive reference. Most of the articles that analyze this issue respond to case-studies or a country analysis (For examples, see Galal et al. [1994] and La Porta and Lopez-de-Silanes [1999]), and only the telecommunications sector has been more deeply analyzed in the region (see for example Ros and Banerjee [2000]). Some exceptions in these sectors are Estache and Rossi (2004) for the case of Electricity Distribution and Galiani et al. (2004) for Water.

Ehrlich et al. (1994) provided good evidence on productivity differences between stateowned and privately owned firms. They used a sample of 23 comparable international airlines of different (and in some cases changing) ownership categories over the period 1973-83 for which they were able to obtain good and comparable cost, output, and ownership data. The researchers developed a model of endogenous, firm-specific productivity growth as a function of firm-specific capital, and used the model as a basis for their fixed-effects regressions estimating a cost function in a simultaneous framework with input-demand equations. They used ownership,<sup>6</sup> output,<sup>7</sup> capital quantity and price indices, labor quality and price indices, fuel indices, TFP indices and productivity trends, technical factors, regulatory measures,<sup>8</sup> and firm and country-specific variables. The study found a significant relationship between ownership and firm-specific rates of productivity growth. The results suggest that private ownership leads to higher rates of productivity growth and declining costs in the long run, and that these differences are not affected by the degree of market competition or regulation.

Boardman and Vining (1989) used data from the 500 largest manufacturing and mining corporations in the world outside the United States, as compiled by _Fortune_ magazine in 1983. They classified these firms as SOEs, Mixed Enterprises or Private Companies, and used four profitability and two efficiency measures. Their results provide evidence that, after controlling for a wide variety of factors, large industrial mixed and public enterprises perform substantially worse than private ones. They also concluded that partial privatizations may be not be the best strategy, since, according to their indicators, these perform quite similarly to SOEs.

Frydman, Gray, Hessel, and Rapaczynski (1999) compared the performance of privatized and state firms in the transition economies of Central Europe, and explicitly tried to control for selection bias. Their study was based on a panel of over 200 privatized and state firms in the Czech Republic, Hungary, and Poland. In particular, their findings show that in the context of Central Europe, privatization has no beneficial effect on any performance measure in the case of firms

> 6 Percent of equity owned by the state.

> 7 An index of four types of output: scheduled passenger kilometers and scheduled freight, scheduled mail and nonscheduled service ton-km actually flown, all of these weighted by corresponding revenue shares. 8 Dummies for the regulatory change in the US in 1976 and in the North Atlantic market in 1978.

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