The politics of liberalisation: Privatisation and regulation‐for‐competition in Europe's and Latin America's telecoms and electricity industries

Abstract

. This article sheds some light on the interaction between politics and learning in the diffusion of liberalisation. It does so by specifying the conditions and ways in which politics and learning interact and thus sustain cross‐national and cross‐sectoral variations in the spread of liberalisation. The process of liberalisation is analysed against data from 32 European and Latin American countries and two sectors. The indicators employed cover the issue of privatisation as well as regulatory reform. An analytical framework is presented that, for the first time, allows a systematic quantitative examination of the contrasting predictions of the Policy Sector Approach (PSA) and the National Patterns Approach (NPA). Four different combinations of variations and similarities across sectors and nations are identified and explained. These explanations are grounded in actor‐centred historical institutionalism. The empirical evidence points to the failure of Latin America to become ‘European’ despite the appearance of sweeping and comprehensive liberalisation. In addition, the article demonstrates how rational actors act in different institutional environments while accommodating the process of learning to their advantage, and how their actions are constrained by different historical legacies of state formation and varied levels of risks and rewards inherent in different sectors.

Europeanization and the retreat of the state

“…Therefore, in the long term, all countries liber-alize and privatize. In a comparison of regulatory reform, Levi-Faur (2003 shows that similar transformation processes also have taken place in Latin America, where all countries challenged by international pressure converged to similar institutional configurations. Levi-Faur's conclusion is that major features of liberalization would have diffused to most if not all European member states even in the absence of EU-level policymaking.…”

Regulatory capitalism and the reassertion of the public interest

“…Yet regulatory agencies proved to be even more popular than privatization. Worldwide, only 90 countries have privatized some of their telecoms operators, but 120 countries have established regulatory agencies (Levi-Faur, 2003a).…”

Introduction: the diffusion of liberalization

“…137 Many examples could be cited, but for an explicit effort to pass on the positive lessons of liberalization see Quirk 1994. 138 Eising 2002. 139 Levi-Faur 2003. It may be that learning happens at the global level, and it may be that it happens among groups of peers who share information and whose experiences are more relevant to each other. In the case of privatization, the policy spread first among European countries, then to Australia and New Zealand and only later to the developing world.…”