Income Elasticity of Environmental Amenities

In this paper we are concerned with the estimation of income elasticities of environmental amenities. The novelty is the application of econometric methods that take into account the problem of measurement errors when estimating these elasticities, which are common in microeconomic data and are not usually considered in the applied literature related with this issue. Our aim is to discuss whether the measurement error has signi…cant e¤ects on the elasticities. Data from the Expenditure Budget Survey of Uruguay (1996) are used.

Articulación público - privada en el financiamiento de la infraestructura de carreteras en Uruguay

This paper presents a case of public – private partnership in road provision in Uruguay. It is a concession where the concessionaire is public owned with a contract so called of present value of expenditure. This scheme is a good solution in a country where people reject private ownership of public services providers, and with lack of independent regulation. It allows private financing of the investment and ensures the stability of the expenditure in maintenance of the roads. The concession contract minimizes the risk allocated to the concessionaire but with correct incentives to be efficient, reducing in this way the probability of renegotiating the contract.concessions, infrastructure, roads

Subasta de telefonía móvil: ¿una experiencia inconclusa en Uruguay?

Uruguay is carring out an incipient regulatory reform process in telecommunication sector. The reform stresses on the liberalization of all services but fixed telephone and national long distance, and the creation of a regulatory agency. Privatization of the national utility is not foreseen. The liberalization of the mobile market requires the use of a scarce resource, the spectrum, that limits the number of possible entrants, thus it was decided to regulate the access through an auction. Licences auctions for mobile provoked a revolution in auction theory. Due to the special characteristics of the object to be auctioned, several designs were developed and applied in different countries. Finally, British auction in multiple rounds was adopted as a consensus design. This kind of desing is better than others used previously, but it is sensitive to some details that influence too much on the auctioneer results. In this paper we analyze the Uruguayan auction design compared to those used in other countries as well as its implementation details. The auction processus is having important problems related to political issues, the relationship with regional telecommunication markets and economic crisis, rather than the auction design itself. In this paper we discuss the relevance of all this elements in promoting competition in mobile market.

Cambios en las concesiones viales en Uruguay: un análisis basado en la teoría de subastas

In this paper we analyze the impact on the value of future investments that would derive from the privatization of a state-owned road concessionaire, taking into account the ability of the government to handle the asymmetry of information vis à vis the concessionaire. A model based on auction theory is developed in order to quantify the expected impact on government from the privatization of the concessionaire assuming the concession contract is not modified. We conclude that if the government decides to privatize the concessionaire, significant changes are required in the concession contract, especially in the absence of institutional transformations that would improve the government supervisory and control capability.road concessions, auction theory

Alternativas en el manejo del riesgo de demanda en concesiones de infraestructura vial

In road concessions – where the effort of the concessionaire cannot increase the demand for infrastructure – it is better not to allocate risk of demand into the concessionaire. Engel et. al. (1997) introduced variable term concessions in order to mitigate risk of demand allocated to the concessionaire. In this paper we introduce variable investment concessions to achieve the same target. We show that both mechanisms are equivalent in their objective of mitigate risk of demand, although the mechanism proposed is more difficult to be implemented. We compare the application of both mechanism in the case of Uruguay.concessions, infrastructure, roads

Marchas y contramarchas en la concesión de carreteras en Uruguay

Uruguay has allowed private sector participation in road construction, operation and maintenance at the end of the 20th century, specially though the form of concessions. The economic result of these concessions is difficult to be evaluated yet since they are still under execution. However, some difficulties were detected; some of them are related to the incentives generated by the design of the contract of the concession and others to the regulatory design. Concession contracts are incomplete and there must be determined previously the way conflicts are going to be handled. The institutional framework of Uruguay - were judiciary is not effective to resolve economic problems in an efficient manner -, make necessary the regulation of contract execution and to establish the way conflicts are going to be solved. Regulation should generate credibility among investors in a sector were investment is highly specific, and also should protect consumers and tax payers from the capture of the regulator by the concessionaire. In Uruguay concessions were not preceded by fundamental institutional changes, like the separation of the regulatory authority from the office that promotes the activity, making difficult to achieve the objectives of the regulation and making evident the regulatory weakness in the sector. Some key issues for concession contracts design are identified, based in practice and in economic literature. These issues are determinant in the possibility of the achievement of some basic objectives, like choosing the more efficient bidder, getting near economic efficiency, and appropriating the biggest part of the informational rent in auctions. Concessions in Uruguay illustrate the effect of mistakes in contract design. This paper stresses the effects of contract design on the incentive’s scheme, and the effects of these incentives on the strategic behaviour of concessionaires. It also points out that the dimension of the effect of errors in contract design have in the achievement of government objectives is sensitive on the institutional and regulatory design. Indeed, a weak institutional framework increases the negative effects introduced by errors in contracts.Four concessions are working at the present time. They have had some problems but they also have had some positive aspects like the use of variable term instruments despite of the lack of national and international experience in the field. In 2000 the government announced the end of the program of concession and the beginning of the so called Megaconcesión. This is an strategy to finance road maintenance when public budget is constrained due to economic crisis. The Megaconcesión contract introduces a moral hazard problem since the main variable to verify the fulfilment of the contract is unobservable by the regulator and it does not exist incentive to control costs by the concessionaire. This problem could be serious if the Megaconcesión is privatised. Since the regulatory design was not improved and this involves a huge project, the privatisation may introduce great regulatory risks (opportunistic expropriation and capture of the regulator).

Competencia en telefonía móvil en Uruguay: diseño de subastas, contratos y marco institucional

Uruguay began a general regulatory reform in the 90s. Regarding the telecommunication sector, the main aspect of the reform was the opening up of the mobile market to competition. The auction designed followed the basic idea that had been developed in the American mobile auctions (1994), and also incorporated lessons from European 3G auctions in 2000. Although the design decisions were correct, the auction failed: there were no entrants to the market and the collection was tiny. The explanation can’t be found in the design of the auction but in a mix of reasons related to the institutional characteristics of the country and the deep economic crisis that started during the auction process, instead.

the case of Uruguay

27 p.Se estima la elasticidad de los ingresos en los servicios de transporte consumidos por los hogares a partir de datos de la Encuesta de Gastos e Ingresos de Uruguay de 1994 y 2006. Considerando los patrones de consumo en Uruguay, los bienes y servicios de transporte individual son artículos de lujo, mientras que los bienes relacionados con el transporte público son los normales. El transporte público permanece como un bien de lujo para el primer quintil de ingresos, un bien inferior para el quintil más rico, y un bien normal para el resto. Los patrones de consumo evolucionan a los que caracterizar a los países desarrollados. Se analizan las implicaciones para el diseño de políticas públicas, particularmente en cuanto a las decisiones de inversión, la financiación de las inversiones y las políticas reguladoras. La inversión pública en infraestructura o servicios de transporte no es considerada ingreso de los sectores beneficiados. Se cuestiona por lo tanto la validez de utilizar información de las decisiones de gasto para evaluar el impacto de las decisiones públicas en la distribución del bienestar

Macroeconomic impacts of the reform of public services in Uruguay - A CGE analysis

This paper investigates the macroeconomic impacts of the reform of public services in Uruguay. A computable general equilibrium (CGE) model is used to simulate different policy scenarios, analyzing the reforms of the regulatory framework of public services, changes in their investment policies, modifications in the competitive environment and reforms in their tax structure. The results show that the macroeconomic effects of the proposed reforms are relatively small.Social Accounting Matrix, Computable General Equilibrium Models, public services, public sector reform.

El proceso de diseño e implementación de políticas y las reformas en los servicios públicos

El trabajo analiza el proceso de reforma en los servicios públicos a la luz del modelo desarrollado por Spiller y Tomassi (2003). El modelo desataca la incidencia que las instituciones políticas tienen en el proceso político, las que se plasman en ciertas características externas de las políticas. En el caso de las políticas relativas a servicios públicos, particularmente las políticas de reforma, se produce una retroalimentación especial de las políticas al propio proceso de política en tanto la reforma constituye una modificación sustancial de las reglas del juego y dan lugar a un cambio importante en los jugadores que lo juegan. Se analizan los procesos de reforma llevados adelante en Argentina, Chile, Uruguay y Perú, los que presentan peculiaridades que permiten visualizar el rol diferencial de la institucionalidad y los procesos políticos sobre los resultados de políticas en materia de privatizaciones y regulación, así como también de la historia concreta y los diversos puntos de partida. Se enfatiza en todos los casos el efecto de retroalimentación que las reformas han tenido sobre el proceso político sectorial específico.Institutions, Policymaking process