Does divestiture matter : a framework for learning from experience

Transferring ownership and control of enterprises from the public to the private sector has recently attracted great interest around the world. Several developed and developing countries have already divested varying portions of their public enterprise (PE) sectors, and many others are planning to follow suit. This paper provides an analytical framework for assessing the arguments for divestiture and for evaluating the lessons of experience. Its aim is to provide researchers with a mechanism to analyze the divestiture phenomenon more rigorously than has been attempted thus far. Ultimately, the findings of such analysis will enable policymakers to form more realistic expectations about the results from undertaking divestiture decisions and the conditions necesssary for attaining the maximum benefits from the application of this instruments. This paper summarizes the rationale for divestiture, reviews the empirical evidence, and then proposes a framework for undertaking an empirical investigation ofthe performance of divested firms. The paper is confined to partial equilibrium analysis, even though it addresses the fiscal impact of divestiture. It assumes a small sample setting, thus precluding econometric analysis. The paper's overall objective is to construct a framework for assessing the advantages and disadvantages resulting from the sale of a single enterprise, not for assessing a country's overall disvestiture program.Economic Theory&Research,Environmental Economics&Policies,Banks&Banking Reform,Public Sector Economics&Finance,Health Economics&Finance

Public enterprise reform : a challenge for the World Bank

Public enterprises (PEs) earn an average 10 percent of GDP in developing countries. Many governments are reexamining the role of the state, so questions about whether to divest PEs or make them more efficient are likely to intensify. The Bank will increasingly be called upon for advice and financial support in managing the transition period. The Bank should maintain its focus on rationalizing the size of PEs, by liquidating nonviable PEs, and transfering their ownership or control to the private sector, if that will make them more efficient. In helping countries improve the efficiency of PEs that remain public, the Bank should emphasize both policy framework and institutional set-up, and restructuring of individual enterprises. It should also extend its analysis of PEs to the socialist economies, explore the relationship between PEs and the private sector, and study how best to phase and sequence PE reforms. The Bank should refine PE reform components and tools, especially in terms of the phasing and sequencing of price liberalization and competition: the budgetary impact of PEs; and the valuation of PEs for divestiture. Lastly, it should learn more systematically from experience by analyzing the outcomes of PE reforms; the performance of divested PEs; the effects on efficiency of staff reductions; and the effectiveness of program contracts on enterprise efficiency.Enterprise Development&Reform,Environmental Economics&Policies,Economic Theory&Research,Banks&Banking Reform,Health Monitoring&Evaluation

The role of regulation and commitment in the development of telecommunications in Chile

Over six decades, Chile experimented with three regulatory regimes and ownership patterns for its telecommunications sectors, each with radically different investment patterns. Until 1970, Chile relied on private ownership and rate-of-return regulation, but excess demand persisted. In the 1970s, Chile relied on public ownership of two regulated monopolies, but the sector grew even more slowly than before. After 1982, Chile deregulated some market segments, introduced benchmark regulation, and returned to private ownership. The new regulatory regime and privatization doubled the number of lines in service in only four years. The author explains investment behavior as a function of the solutions to two contracting problems: between government and the firm, and between government and interest groups. The author concludes that regulatory rules on pricing, entry, and conflict resolution mechanisms are critical for investing in such asset-specific utilities as telecommunications. More important, the outcome of regulatory reform depends on a match between reform and both the prevailing political and judicial systems and interest group politics. According to the author, Chile satisfactorily resolved the two contracting problems in the 1980's. Chile's new regulations are reasonably efficient and very specific about how tariffs are to be calculated, how entry is to be governed, and how conflicts are to be resolved. The rules are embodied in a law that is relatively difficult to change (because the judicial system is independent). The impetus for reform came from the emergency of a new private entrepreneurial class, whose growth depends on modern telecommunications services.Environmental Economics&Policies,Public Sector Economics&Finance,National Governance,ICT Policy and Strategies,Economic Theory&Research

Challenges for reducing inequities in health and healthcare for the 21st Century

Human life expectancy during the time of the Roman Empire was approximately 28 years. In 1990, global life expectancy had increased to 65 years. The advances in life expectancy in the 20th century were remarkable by any standard. Although many factors contributed to this enhanced life expectancy, including medical technologies, by far the largest proportion of the increase occurred as a consequence of economic growth, rising living standards and nutrition. Despite the large improvements in terms of life expectancy, significant health variations still remain between countries and across different socioeconomic classes with in countries. As the 20th century proceeded, a growing dichotomy existed between those who are healthy and have access to medical care and those who are not healthy and do not have access to such services. Moreover, evidence shows that such inequities in health and healthcare are increasing. The present paper will analyze the dynamics of shifts in health profile during the early period of the last century and describe the major determinants of inequities in health and healthcare at the international level. Challenges facing the reduction in inequalities in health and healthcare will be discussed

Discrete Breather and Soliton-Mode Collective Excitations in Bose-Einstein Condensates in a Deep Optical Lattice with Tunable Three-body Interactions

We have studied the dynamic evolution of the collective excitations in Bose-Einstein condensates in a deep optical lattice with tunable three-body interactions. Their dynamics is governed by a high order discrete nonlinear Schrodinger equation (DNLSE). The dynamical phase diagram of the system is obtained using the variational method. The dynamical evolution shows very interesting features. The discrete breather phase totally disappears in the regime where the three-body interaction completely dominates over the two-body interaction. The soliton phase in this particular regime exists only when the soliton line approaches the critical line in the phase diagram. When weak two-body interactions are reintroduced into this regime, the discrete breather solutions reappear, but occupies a very small domain in the phase space. Likewise, in this regime, the soliton as well as the discrete breather phases completely disappear if the signs of the two-and three-body interactions are opposite. We have analysed the causes of this unusual dynamical evolution of the collective excitations of the Bose-Einstein condensate with tunable interactions. We have also performed direct numerical simulations of the governing DNLS equation to show the existence of the discrete soliton solution as predicted by the variational calculations, and also to check the long term stability of the soliton solution.Comment: 20 pages, 6 figures , Accepted for publication in Eur. Phys. J. D (EPJ D

Reforming land and real estate markets

Land and real estate reforms have not been effective at achieving their objectives, in part because of how they have been designed and implemented. To be successful, reforms must become comprehensive in design, argue the authors, although implementation may be phased over time and take local conditions into account. Reform must include three elements: 1) Institutional reforms that better define property rights, reduce information asymmetry, and improve contract enforcement. 2) Capital market reforms that make mortgage finance available at reasonable rates, especially for the poor. 3) Market reforms that reduce or eliminate the main distortions in the prices of goods and services produced by land and real estate assets. In their review of land and real estate reforms supported by the World Bank, the authors find that such reforms receive less attention at the conceptual stage than they should, considering their great impact on poverty, growth, and stability. They base their conclusion on the limited coverage of land and real estate issues in country assistance strategies, the main vehicle for identifying priority areas for reform. Most Bank-supported projects do not address all three elements critical for reform. And most provide no justification for excluding them, and no plan for follow-up. The Bank's Operations Evaluation Department rates Bank-supported land and real estate projects relatively well on outcome and sustainability but not on institutional development. But land and real estate reform is institutional by nature. The authors urge the Bank and policymakers to change course. After a comprehensive assessment of the status of real estate institutions and markets, all actors in this sector should be pulled together to develop a comprehensive approach to land and real estate reform.Banks&Banking Reform,Environmental Economics&Policies,Land and Real Estate Development,Municipal Housing and Land,Real Estate Development,Environmental Economics&Policies,Banks&Banking Reform,Municipal Housing and Land,Land and Real Estate Development,Real Estate Development

Regulating telecommunications in developing countries : outcomes, incentives, and commitment

In response to the recent wave ofprivatizing and regulating monopolies in developing countries, the authors evaluate the impact of different regulatory schemes on private sector behavior in the telecommunications sector in seven countries. They find that regulation is most effective - meaning, it results in substantial investment by the private sector, reasonable returns on this investment, and greater productivity - where the government/regulators reduce the firm's information advantage, induce the firm (through pricing) to operate efficiently, and institute safeguarding mechanisms to protect the firm against expropriation of assets or quasi-rents. Conversely, where the government/regulators fail to resolve information, incentive, and commitment problems, private sector returns are relatively high, and investment and productivity are relatively low.Economic Theory&Research,Environmental Economics&Policies,Decentralization,International Terrorism&Counterterrorism,Public Sector Economics&Finance,Environmental Economics&Policies,Economic Theory&Research,Public Sector Economics&Finance,Knowledge Economy,Education for the Knowledge Economy

From the Perspective to the Analytic: A New Direction for Information Systems Engineering Methodology

Information systems engineering (ISE) methodology has been so far predominated by an overly normative/ prescriptive view of what methodology should be. This has been to the detriment of both the contextual fit and dynamic evolvement of an information system. This paper argues for the analytic emphasis to supplant the prescriptive one, so as to enable the concept of continuous design needed for the dynamic evolvement of information systems

Stakeholder identification in the requirements engineering process

Adequate, timely and effective consultation of relevant stakeholders is of paramount importance in the requirements engineering process. However, the thorny issue of making sure that all relevant stakeholders are consulted has received less attention than other areas which depend on it, such as scenario-based requirements, involving users in development, negotiating between different viewpoints and so on. The literature suggests examples of stakeholders, and categories of stakeholder, but does not provide help in identifying stakeholders for a specific system. In this paper, we discuss current work in stakeholder identification, propose an approach to identifying relevant stakeholders for a specific system, and propose future directions for the work