The Empirics of Regulatory Reforms Proxied by Categorical Variables: Recent Findings and Methodological Issues

Arbeitspapier

Some regulatory reforms do not change just a specific signal that can be represented by a quantitative continuous variable, such as a tax rate, a price cap, or an emission threshold. The standard theory of reform in applied welfare economics (going back to contributions by e.g. Ramsey, Samuelson and Guesnerie) asks the question: What is the marginal effect on social welfare of changing a policy signal? However, reforms such as privatization, unbundling or liberalization of network industries are often described by ‘packages’ shifting a policy framework. It is increasingly frequent in the empirical evaluation of such reforms to use categorical variables, often in polytomous form, for instance describing unbundling steps (vertical integration, accounting, functional, legal, ownership separation) on a discrete numerical scale, such as those proposed by the OECD and other international bodies. We review recent econometric literature evaluating regulatory reforms using such variables (40 papers) and we discuss some methodological issues arising in this context.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Nota di Lavoro ; No. 22.2017

Classification and Topics

• Classification: Wirtschaft ; Economic Methodology ; Single Equation Models; Single Variables: General ; Quantitative Policy Modeling ; Microeconomic Policy: Formulation, Implementation, and Evaluation ; Industry Studies: Utilities and Transportation: Government Policy
• Subject: Econometrics ; Policy Evaluation ; Network Industries ; Reforms

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bastianin, Andrea ; Castelnovo, Paolo ; Florio, Massimo
• Event: Veröffentlichung
• (who): Fondazione Eni Enrico Mattei (FEEM)
• (where): Milano
• (when): 2017

Further information

• Handle: http://hdl.handle.net/10419/162264
• Last update: 10.03.2025, 11:41 AM CET