Infrastructure Data Set

The basis of the empirical analysis in this chapter is a data set that contains information for 25 countries and two sectors along all three reform dimensions. These data allow us to analyze statistically and to visualize graphically the degree of cross-country regime similarity. However, the collection of infrastructure data confronts the researcher with several problems. First and foremost, data availability is not the same for each sector and for all of the 25 countries. While current status quo data can be collected for all three reform dimensions, reliable time series data are only available for the privatization dimension. For the liberalization and reregulation dimension the collection of time series data is extremely difficult and problematic. This is due to the fact that for both dimensions

quantifiable historic data, especially for the time before 1990, are very hard to find.¹⁷⁷ Thus, the Infrastructure Data Set comprises status quo data as of the year 2003 as well as time series privatization data for the period 1980-2003 for the EU-15 and for the period 1990-2003 for the CEEC-10.

Privatization data were partly available from a data set created for the project

‘Globalization, Europeanization and the Redimensionalization of the State: The Privatization of Infrastructures’ which was directed by Professor Volker Schneider at the University of Konstanz between October 2000 and November 2003 and which was funded by the German Research Council.¹⁷⁸ However, as the data set only covers the infrastructure sectors of West European countries and a time period until the year 2000, additional privatization data had to be collected for the CEECs and for the time after the year 2000.

As outlined above, the indicator used for measuring privatization is the ‘level of state ownership’ of the former monopolist. The advantage of this indicator is that it is able to map not only the scope of state retreat but also its timing. It further possesses certain characteristics that ensure inter-subjective comparability across countries (Ehni et al. 2004:

116). The focus in the analysis here lies on material and not on formal privatization. The reason is that formal privatization does not change the ownership structure of the former monopolist but only the company’s legal form. Material privatization, in contrast, refers to the de facto transfer of property rights from the state to private investors. However, the collection of material privatization data has several pitfalls as it is the case for data on market liberalization.

177 Reliable information on NRAs, for instance, are in most cases only available for their current organizational structure and functional profile. In addition, the comparison of NRA structures and profiles possesses a different logic than, for instance, the comparison of privatization policies. While the latter calls for an analysis of developments over time, the inclusion of the time dimension in the comparison of NRAs would not offer much additional analytical value. The reason is that many characteristics of NRAs do not change significantly over time once the regulator has been established. This is especially true for organizational features. Hence, variation is presumably too small to justify the extreme effort of data collection that would be necessary to conduct time series analysis for this policy dimension.

178 In this regard, I am indebted to Carmen Ehni, Simon Fink, Alexander Jäger, Janina Thiem and Tino Warthmann for their work with data collection, namely state ownership data for the EU-15 between 1980 and 2000. I am further indebted to Nadja Schorowsky for her help with the collection of reregulation data on NRAs in telecommunications. All other data were collected by the author.

The first problem has to do with the information provided by data bases of international organizations, i.e. the OECD or World Bank, and of sector-specific agencies, i.e. ITU or IEA. These data bases mainly offer information only for selected countries and years. It was therefore not possible to gather privatization data for the new CEEC-10 by using only one source of information. Thus, privatization data for the three infrastructure sectors in the CEEC-10 had for the most part to be collected using various sources, i.e.

publicly available data bases, government publications, EU documents, newspaper articles or official company information, i.e. annual reports. As a consequence, not all information are coherent and mistakes in course of data collection are therefore inevitable.

One of the major problems in this context is the validity of the measurements.

Validity means that we are actually measuring what we think we are measuring (King, Keohane and Verba 1994: 25). There might be several different indicators for material privatization and these indicators can differ significantly, depending on the source. While the indicators of some data bases cover only forms of direct state ownership, others include also indirect forms.¹⁷⁹ In the electricity sector, for instance, shareholders of the former monopolist are not only federal but also municipal authorities. This is due to the fact that the electricity sector is organized in a rather fragmented and decentralized way. It was therefore necessary to individually check the privatization indicators used by the different data bases in order to be able to conduct a correct comparison of developments across countries and sectors.

A similar problem regards the collection of data on liberalization and reregulation.

Liberalization is conceptualized in many different ways depending on the source of information. It covers indicators as different as, for instance, the ‘degree of market opening’, the ‘level of competition’ or the ‘number of new market entrants’. Similar to the data on privatization, it was necessary to realign the various indicators in order to conduct

179 In Germany, for instance, the Kreditanstalt für Wiederaufbau (KfW), of which 50 per cent belong to the federal state and 50 per cent to the German Länder, held approximately 16 per cent of Deutsche Telekom in the year 2004. At the same time, the German federal state held 26 per cent of Deutsche Telekom directly.

Thus, we might end up with three different levels of state ownership: dependent on whether the respective indicator counts as state ownership all of the 16 per cent, only half of it or none, state ownership amounts to 42 per cent , 34 per cent or 26 per cent, respectively.