Impactos de bem-estar da privatização de infra-estrutura

This paper deals with the welfare and long run allocation impacts of privatization. There are two types of capital in this model economy, one exclusively private and the other has public good features, denominated infrastructure, which is offered by both public and private sectors. A positive externality due to infrastructure capital is assumed. So the government can improve upon decentralized allocations by way of internalizing the externality. Public investment is financed through distortionary taxation. It is shown that the welfare net gains of privatization depend on the quality and quantity of the private infrastructure supply. Furthermore, those net gains are strongly related to the quality control of the new private infrastructure supply that emerges after the privatization policy.