Taking Stock of the Political Economy of Power Sector Reforms in Developing Countries : A Literature Review
The power sector reform experiences of developing countries vary greatly. To help explain this from a political economy perspective, this paper reviews several dozen statistical analyses, multi-country case studies, and development practice publica...
| Main Authors: | , |
|---|---|
| Language: | English |
| Published: |
World Bank, Washington, DC
2018
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/431981531320704737/Taking-stock-of-the-political-economy-of-power-sector-reforms-in-developing-countries-a-literature-review http://hdl.handle.net/10986/29991 |
| Summary: | The power sector reform experiences of
developing countries vary greatly. To help explain this from
a political economy perspective, this paper reviews several
dozen statistical analyses, multi-country case studies, and
development practice publications. The frame of reference is
the model of market-oriented reforms that became a global
norm in the 1990s. Findings are organized in terms of the
history, theory, motives, processes and outcomes of reforms.
Market orientation emerged around the 1980s as part of a
shift in economic theory and policy away from state control,
and was expected to improve efficiency and investments.
Reform advocates never took political economy issues into
full consideration. Yet, policy makers have had
sociopolitical as well as technical motives for reform, such
as crisis response. International norms and competition for
foreign investment and trade pulled governments to model
reforms, while development partners pushed them as a
condition of aid. Reform implementation has been
characterized by strong tensions among different public and
private interests. Concretely, 1990s model reforms were
based on a logic of depoliticizing pricing and investment
decisions; often placing policy makers in a conflict of
interest situation. Thus, the political costs and risks of
reform have often exceeded the benefits perceived by local
decision makers, especially as reforms did not generally
result in immediate benefits for citizens. In practice,
incremental, inclusive processes may be better than quick
and stealthy reforms that sidestep stakeholders'
concerns. While there was limited evidence of efficacy at
the time the reforms were implemented, ex post the outcomes
of reforms are ambiguous, as improvements in some areas have
been offset by negative results elsewhere. For increasing
access to electricity and clean energy, 1990s model reforms
may help, but they are neither necessary nor sufficient, nor
did they focus on these objectives. In conclusion, the
success or failure of policy prescriptions such as 1990s
model reforms are contingent on dynamic, context-specific
institutions as well as factors beyond the sector. More work
is needed on integrated, flexible approaches to think and
work politically in the sector, and to account for new
technology and diverse sector development objectives. |
|---|