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Working Paper 51 - Competition and Regulation in Infrastructure
The restructuring of infrastructure is predicated on the need to be efficient in the use of resources and to become competitive in the global economy. It is thus an essential component of regulatory reform, defined here to extend beyond the functions of the regulatory body and to be inclusive of policy-changes aimed at bringing about sector restructuring. In most cases the restructuring process requires the reduction of government provisions by increasing the level of private participation in the provision of infrastructure services. In a limited number of cases it requires deregulation of the industry or a combination of deregulation and re-regulation where natural monopoly characteristics are evident. Thus, in the case of the developed economies, two different approaches have been discerned because of the differences in the nature of the provisions.