Privatization and the sources of performance improvement in the global telecommunications industry

This paper examines the financial and operating performance of 31 national telecommunication companies in 25 countries that were fully or partially privatized through public share offering. Using conventional pre- versus post-privatization comparisons and panel data estimation techniques, we find that the financial and operating performance of telecommunications companies improves significantly after privatization, but that a sizable fraction of the observed improvement results from regulatory changes--alone or in combination with major ownership changes--rather than from privatization alone.