Regulating Quality: Let Competing Firms offer a Mix of Price and Quality Options
Author: Bill Baker and Sophie Tremolet Date: 10/1/2000 (PDF, 200KB)
In many developing countries, the regulation of infrastructure service standards is too rigid and makes services too expensive for the poor. The current wave of liberalization of infrastructure is an opportunity to address this problem. Debate on expanding access under such reform has so far centered on price, not quality. This Note proposes a new regulatory framework where large- and small-scale providers compete to supply a range of services at prices better reflecting consumer willingness to pay.