English, Article, Journal or magazine article edition: Privatization discontent and its determinants: evidence from Latin America Daniele CHECCHI; Massimo FLORIO; Jorge CARRERA

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Physical Description
  • preprint
Language
  • English

Edition details

Title
  • Privatization discontent and its determinants: evidence from Latin America
Author
  • Daniele CHECCHI
  • Massimo FLORIO
  • Jorge CARRERA
Physical Description
  • preprint
Notes
  • Privatization policy faces increasing popular opposition in Latin America. We test for the determinants of this discontent. We use the results of Latinobarometro (2002), a survey of a representative sample of 18522 individuals in 17 countries as our dependent variable of perception, and a privatization dataset on the same countries, including sectoral disaggregation of divestitures, time profiles, proceeds, and other variables for each country. We use as well a set of macroeconomic variables as controls.. Our main finding is that disagreement with privatization is more likely when the respondent is poor, privatization was large and quick, involved a high proportion of public services as water and electricity, the country suffered adverse macroeconomic shocks, and there is high inequality of incomes. The more the respondent is educated, the more adverse to privatization he or she is. We suggest that these results depict a broadly consistent picture of privatization discontent that points to distributional issues, probably because of tariff rebalancing not adequately addressed by policy makers and regulators, as suggested by earlier empirical papers. Further research is needed on the relationship between perceptions and actual welfare changes.
  • RePEc:iza:izadps:dp1587
  • While most economists usually believe that privatization policy is socially beneficial, it faces increasing opposition in several countries. In this paper we wish to discover the ingredients in a recipe for privatization discontent. To do so we focus on Latin America, where there is wide evidence of popular opposition to privatization. We use the results of Latinobarometro (2002), a survey of a representative sample of 18501 individuals in 17 countries as our dependent variable of perception, and a privatization dataset on the same countries, including sectoral disaggregation, time profiles, proceeds, number of shares and other variables for each country. We use a set of macrovariables as controls, and test our prior beliefs on the determinants of policy failure in this area. Our main finding is that disagreement with privatization is more likely when the respondent is poor, privatization was large and quick, involved a high proportion of public services as water and electricity, and the country suffered adverse macroeconomic shocks in a condition of high disequality of incomes. Moreover, the more the respondent is educated, the more adverse to privatization he or she is. We suggest that these results depict a broadly consistent picture of privatization discontent that points to a combination of perceived distributional concerns that should be addressed by future research and policy design
  • Privatization, Latin America, Distributive impact, Panel Survey Data, Social Attitudes
  • RePEc:mil:wpdepa:2004-23
Language
  • English
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