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Privatization and Regulatory Reform of Toll Motorways in Europe
Author(s) -
ALBALATE DANIEL,
BEL GERMÀ,
FAGEDA XAVIER
Publication year - 2009
Publication title -
governance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.46
H-Index - 76
eISSN - 1468-0491
pISSN - 0952-1895
DOI - 10.1111/j.1468-0491.2009.01436.x
Subject(s) - deregulation , toll , restructuring , context (archaeology) , corporate governance , government (linguistics) , economic interventionism , regulatory reform , economics , private sector , control (management) , intervention (counseling) , public sector , state (computer science) , regulatory state , business , industrial organization , economic system , public economics , market economy , economy , finance , economic growth , politics , political science , genetics , biology , philosophy , algorithm , psychiatry , law , linguistics , computer science , psychology , paleontology , management
This article analyzes current trends in toll motorway privatization in Europe as an illustration of the paradox of simultaneous deregulation/privatization and reregulation. Changes in the form of government intervention are identified as transitions from internal control on processes and inputs to external control on performance outputs. The state guarantees its capability to intervene and seek its own objectives even when giving up public property. In fact, output regulation is a partial substitute for public ownership. We analyze the hypothesis that privatization of motorways spurs price regulation. Indeed, we observe that toll regulation becomes more detailed as the private sector increases in size, which is a regular reaction across different institutional frameworks. This result is consistent with the literature on the rise of a regulatory state, which emerges with a new mode of governance based on indirect government. Moreover, the study provides evidence of the importance of temporal context in modeling public sector restructuring.