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24.10.2023

Understanding the energy sector deregulations: international evidence

verfasst von: Shengquan Wang, Jiawen Luo

Erschienen in: Empirical Economics | Ausgabe 4/2024

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Abstract

We extend the political economy analysis of reforms proposed by Abiad and Mody (Am Econ Rev 95(1):66–88, 2005) to the energy sector, then the ‘crises’ and ‘learning’ hypotheses are modified, and the roles of economic openness and capital markets are emphasised. Given the hypotheses, a conceptual framework of energy deregulations is proposed. Furthermore, we employ 46 countries panel dataset to conduct the empirical analysis. We find that energy sector deregulations are a dynamic learning process; specifically, the U-shaped nexus between the previous experience of deregulations and the current change of deregulations is confirmed. The systemic banking crises and the sovereign debt crises are the drivers of deregulations in the electricity sector and gas sector, respectively, while the currency crises, economic recession, and inflation reverse it. For political variables, we find the parliamentary government significantly matters with the reforms, while other variables will drag the deregulations or shape the deregulations insignificantly. The economic openness and capital market development are identified as the prominent-driven factors of energy reforms. The baseline results are stable through a series of robustness checks.

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Fußnoten
1
In this paper, we use ‘reform’ to explain two cases, namely ‘deregulate’ and ‘regulate’.
 
3
In Abiad and Mody (2005), they introduce three political variables, including the incumbent executive’s first year in office, the political orientation (the left and the right). However, the three variables do not cover information about distribution conflicts; our study, following the specification of Agnello et al. (2015), provides a supplement.
 
4
We follow the specification of Abiad and Modey (2005) and leave CENTRIST as omitted category.
 
5
The dependent variable (i.e. the regulation status of energy sectors) limits our sample end in 2013.
 
9
This variable is from the Polity IV database.
 
10
This variable is from the WDI database.
 
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Metadaten
Titel
Understanding the energy sector deregulations: international evidence
verfasst von
Shengquan Wang
Jiawen Luo
Publikationsdatum
24.10.2023
Verlag
Springer Berlin Heidelberg
Erschienen in
Empirical Economics / Ausgabe 4/2024
Print ISSN: 0377-7332
Elektronische ISSN: 1435-8921
DOI
https://doi.org/10.1007/s00181-023-02508-5

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