Changing prices after the reform of local public services: remunicipalization versus privatization
Identificadores
URI: https://hdl.handle.net/10481/90256Metadatos
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Albalate, Daniel; Bel, Germà; González-Gómez, Francisco; Hernández-Gutiérrez, José C.; Picazo-Tadeo, Andrés J.Editorial
Springer
Materia
Local public services Prices Privatization Remunicipalization Urban water
Fecha
2024-03-27Referencia bibliográfica
Albalate, D., Bel, G., González-Gómez, F., Gutiérrez-Hernández, J.C. and Picazo-Tadeo, A.J. (2024). Changing prices after the reform of local public services: remunicipalization versus privatization. Journal of Regulatory Economics.
Patrocinador
Open Access funding provided thanks to the CRUE-CSIC agreement with Springer Nature. This work has been supported by the Spanish Agencia Estatal de Investigación, Ministerio de Ciencia e Innovación MCIN/AEI/https://doi.org/10.13039/501100011033 (projects PID2020-115135 GB-I00 to A.J.P.-T., PID2022-136235NB-I00 to F.G-G., and PID2022-138866OB-I00 to D.A. and G.B.); the Generalitat de Catalunya (project 2021 SGR 00261 to D.A. and G.B.); and the Generalitat Valenciana (project PROMETEO CIPROM/2022/50 to A.J.P.-T.).Resumen
Privatization and remunicipalization have been used as alternative options to reform the delivery of local public services; in both cases, mainly because of disappointment with the service performance, although ideological preferences might also play a role. The drivers and effects of water privatization have been widely studied, whereas little empirical evidence is available for remunicipalization, particularly regarding its effects. Using a sample of Spanish municipalities, this paper assesses the change in the price of urban water following remunicipalization as compared to privatization. The main finding is that remunicipalization leads to smaller increases in price; this outcome is, however, due to a few atypical municipalities with abnormally low prices before the policy reform. Once these influential observations are controlled for, whether the reform consists of remunicipalization or privatization makes no difference regarding price changes. It is also found that remunicipalization is much more likely in cities governed by extreme left-wing parties.