Please use this identifier to cite or link to this item: http://hdl.handle.net/2445/62286
Title: Local privatization, intermunicipal cooperation, transaction costs and political interests: Evidence from Spain
Author: Bel i Queralt, Germà, 1963-
Fageda, Xavier, 1975-
Keywords: Privatització
Ajuda econòmica
Empirisme
Control de costos
Municipis
Privatization
Economic assistance
Empiricism
Cost control
Municipal corporations
Issue Date: 2008
Publisher: Universitat de Barcelona. Institut de Recerca en Economia Aplicada Regional i Pública
Abstract: Several empirical studies have analyzed the factors that influence local privatization. Variables related to fiscal stress, cost reduction, political processes and ideological attitudes are the most common explanatory variables used in these studies. In this paper, we add to this literature by examining the influence of transaction costs and political factors on local governments’ choices through new variables. In addition to this, we consider the role of additional aspects, such as intermunicipal cooperation as a potential alternative to privatization in order to exploit scale economies or scope economies. We consider two relevant services: solid waste collection and water distribution. Results from our estimates show that privatization (that is, contracting out to a private firm) is less common for water distribution than for solid waste collection. Higher transaction costs in water distribution are consistent with this finding. Furthermore, we find that municipalities with a conservative ruling party privatize more often regardless of the ideological orientation of the constituency. This shows that those political interests able to influence local elections are more important in determining the form of delivery than is the basic ideological stance of the constituency. Finally, we find that intermunicipal cooperation is an alternative to local privatization.
Note: Reproducció del document publicat a: http://www.ub.edu/irea/working_papers/2008/200804.pdf
It is part of: IREA – Working Papers, 2008, IR08/004
URI: http://hdl.handle.net/2445/62286
ISSN: 2014-1254
Appears in Collections:Documents de treball (Institut de Recerca en Economia Aplicada Regional i Pública (IREA))

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