A comparative analysis on regulatory independence

Official URL: http://risc01.sabanciuniv.edu/record=b1649005 (Table of Contents)

Although regulatory agencies have been established in many middle-income countries under the influence of similar external actors as well as the market pressures since the 1990s, the levels of regulatory independence of these agencies vary considerably across countries and across time within the same countries. This research explores the variation in the degree of independence of regulatory agencies across countries and time by measuring regulatory independence in telecommunication sector of 36 middle income countries. It looks into economic, political and market-based indicators as explanatory factors of the variation in the degree of independence. Cross-national results indicate that the freedom in political rights, democracy level and investment freedom have a positive impact on the agency independence whereas state ownership in the sector and presidential form of government correlates with independence negatively. Contrary to studies on advanced economies, it does not find any statistically significant impact of income level, rule of law and number of veto players on regulatory independence. Cross-temporal analysis, looking at four countries’ formal independence mechanisms from 2006 to 2016, demonstrates that formal independence cannot be preserved as once and for all. Following political and economic uncertainties, governments who were willing to delegate authority to independent regulators may undermine not only de facto, but also formal independence of agencies over time through means of budget control, dispossession of competences and autonomy loss in decision making.