Empirical evidence on the impact of privatization of fixed-line operators on telecommunications performance - Comparing OECD, Latin American, and African countries

The aim of this paper is to highlight empirically some important worldwide differences in the impact of privatization of the fixed-line telecommunications operator on network expansion, tariffs, and efficiency during the 1985-2007 period for a large panel of countries. Our work suggests that the divergent results in the empirical literature on the performance of the privatization reform can be explained to a large extent by cross-regional heterogeneity. We find that the impact of privatization on outcomes is significantly positive in OECD and African resource scarce coastal countries, weakly positive in Latin American and the Caribbean countries, and strongly negative in African resource rich and African resource scarce landlocked countries. The results presented in this paper thus challenge the idea that there is a unique model of reform for infrastructure sectors that is equally applicable across regions and countries.