Competition Buzz: Argentina’s Transport Privatization and Re-Regulation: Ups and Downs of a Daring Decade-Long Experience

Antonio Estache, Université Libre de Bruxelles (ULB)
José Carbajo,European Bank for Reconstruction and Development
& Gines de Rus, University of Las Palmas de Gran Canaria

Argentina’s experience shows that transport privatization and deregulation provide efficiency gains that can be delivered to users. Despite unexpectedly high residual subsidy requirements, fiscal costs are lower, services have improved, and new investment is taking place. Argentina’s decade-long experience shows that the reform process involves learning by doing. Inexperienced new regulators quickly face the challenges in controlling monopoly power and providing long-run incentives for private investment. Designing sustainable reform requires a commitment by government to minimize its role in the sector and to respect its original promises to both users and concessionaires.

Full content: SSRN

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