Regulatory Impact Assessment in Developing and Transition Economies: A Survey of Current Practice

Regulatory impact assessment (RIA) involves a systematic appraisal of the costs and benefits associated with a proposed new regulation and evaluation of the performance of existing regulations. So far, most academic research has been concerned with the adoption of RIA in OECD countries. This article assesses the contribution that RIA can make to 'better regulation' in developing and transition economies. The results reported in this article suggest that a growing number of low and middle-income countries are beginning to apply some form of regulatory assessment, but that the methods adopted are partial in their application and are not systematically applied across government. The authors discuss the implications of their findings for capacity building and future research.     

Towards Better Regulatory Governance?

Abstract

This article looks at regulatory reform in selected developing countries in Asia and Africa, by making use of the data collected through two existing questionnaire surveys conducted in 2003 and 2007 respectively. It is found that regulatory reform in these countries has not shifted from making ad hoc improvements to regulatory structures to taking a systematic view of regulatory governance and the means of promoting and enhancing it. For regulatory reform to improve regulatory governance, changes should be brought to both formal and informal institutions. Regulatory reform should also be integrated into the general reform of the public administration.     

Price and Profit Regulation in Developing and Transition Economies: A Survey of the Regulators

Rate of return or cost of service regulation was the traditional means by which governments, especially in the USA, regulated profitability and prices in privately-owned public utility businesses. However, rate of return regulation was associated with efficiency disincentives. Hence, in 1983 a price cap was proposed to regulate British Telecom when it was privatized. Price caps were later introduced for other privatized utilities in the UK. Similarly, other countries that privatized their utility sectors in the 1980s and 1990s often introduced price cap regimes. This article reports the results of a questionnaire survey of the methods used to regulate profits and prices in privatized utility sectors in a sample of developing and transition economies. In addition to providing an insight into the different methods used in these economies, the article explains the difficulties that their regulators have in operating profit and price regulation regimes.     

An Empirical Analysis of State and Private-Sector Provision of Water Services in Africa

Under pressure from donor agencies and international financialinstitutions such as the World Bank, some developing countrieshave experimented with the privatization of water services.This article reviews the econometric evidence on the effectsof water privatization in developing economies and presentsnew results using statistical data envelopment analysis andstochastic cost frontier techniques and data from Africa. Theanalysis fails to show evidence of better performance by privateutilities than by state-owned utilities. Among the reasons whywater privatization could prove problematic in lower-incomeeconomies are the technology of water provision and the natureof the product, transaction costs, and regulatory weaknesses.     

Electricity sector reform in developing countries: an econometric assessment of the effects of privatization,competition and regulation

Electricity sectors in both developed and developing countries have been subject to restructuring to introduce private capital and increase competition. Although the effects of such reforms in a number of the developed economies are now well documented, the experience of developing countries is much less well researched. This paper provides an econometric assessment of the effects of privatization, competition and regulation on the performance of the electricity generation industry using panel data for 36 developing and transitional countries, over the period 1985–2003. The study identifies the impact of these reforms on generating capacity, electricity generated, labor productivity in the generating sector and capacity utilization. The main conclusions are that on their own privatization and regulation (PR) do not lead to obvious gains in economic performance, though there are some positive interaction effects. By contrast, introducing competition does seem to be effective in stimulating performance improvements.