The politics of liberalisation: Privatisation and regulation-for-competition in Europe's and Latin America's telecoms and electricity industries


David Levi-Faur, Department of Politics, University of Haifa, Haifa, Mount Carmel, 31905 Israel. Tel: 972 (0)4 8240599; Fax: 972 (0)4 8257785; E-mail:


Abstract.  This article sheds some light on the interaction between politics and learning in the diffusion of liberalisation. It does so by specifying the conditions and ways in which politics and learning interact and thus sustain cross-national and cross-sectoral variations in the spread of liberalisation. The process of liberalisation is analysed against data from 32 European and Latin American countries and two sectors. The indicators employed cover the issue of privatisation as well as regulatory reform. An analytical framework is presented that, for the first time, allows a systematic quantitative examination of the contrasting predictions of the Policy Sector Approach (PSA) and the National Patterns Approach (NPA). Four different combinations of variations and similarities across sectors and nations are identified and explained. These explanations are grounded in actor-centred historical institutionalism. The empirical evidence points to the failure of Latin America to become ‘European’ despite the appearance of sweeping and comprehensive liberalisation. In addition, the article demonstrates how rational actors act in different institutional environments while accommodating the process of learning to their advantage, and how their actions are constrained by different historical legacies of state formation and varied levels of risks and rewards inherent in different sectors.