In the Spanish region of Catalonia the industrial sector sensibly lobbied for the privatization of municipalityproduced water services in the period 19962002. This paper analyzes the extent to which this result is consequent with observed measures of crosssubsidies in favor of residential consumers. I run a treatmenteffects regression on a sample of 133 municipalities in 2000 and 2001. Recent privatization has a positive effect on the weight that the local regulator attaches to industrial users' welfare when deciding water tariffs. I conclude that an increase of industrial customers' group size has a twofold effect on the crosssubsidy in favor of residential customers: a direct positive substitution effect and an indirect negative political support effect through lobbying for service privatization. © 2008 a Pion publication printed in Great Britain.
The link between service privatization and price distribution among consumer types: municipal water services in the Spanish region of Catalonia
Miralles Asensio A
2008-01-01
Abstract
In the Spanish region of Catalonia the industrial sector sensibly lobbied for the privatization of municipalityproduced water services in the period 19962002. This paper analyzes the extent to which this result is consequent with observed measures of crosssubsidies in favor of residential consumers. I run a treatmenteffects regression on a sample of 133 municipalities in 2000 and 2001. Recent privatization has a positive effect on the weight that the local regulator attaches to industrial users' welfare when deciding water tariffs. I conclude that an increase of industrial customers' group size has a twofold effect on the crosssubsidy in favor of residential customers: a direct positive substitution effect and an indirect negative political support effect through lobbying for service privatization. © 2008 a Pion publication printed in Great Britain.Pubblicazioni consigliate
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