Integrating the power sector in India: Reflections and suggestions
Abstract The historical development of the power generation industry in India shows a steady trend towards complete integration: ‘… The aim is to connect all the power-regions by the end of the Seventh Plan. The desirability of having a single organization to own and to operate the essential elements of the national grid needs to be urgently considered …’ ([4], p 335). This paper seeks to verify the actual desirability of integration, through economic as well as technical aspects; and to emphasize the deviations induced by a strengthened concentration and suggest corrective directions to a second-best equilibrium.
Dual v uniform prices — an application
Abstract The economic literature on non-linear pricing schemes mainly considers the case where average price decreases with quantity — indeed this pricing strategy is often referred to, especially by firms displaying non-convex production sets. However, such a price schedule seems inadequate to cope with the ‘endowments’ of most developing countries, viz severe income inequalities and binding capacity constraints. Thus, we design here an increasing-blocks tariff and show, as an illustration, how it can improve the distribution pattern of low-voltage electricity in India without depressing the producer's profit. Shadow income transfers automatically flow within the sector, without requiring the heavy informational and operational background necessary for lump-sum transfers, as advocated by second-best theory.
Deliberative Democracy and the Resource Curse: A Nationwide Experiment in Tanzania
Oil and gas discoveries in developing countries are often associated with short-sighted economic policies and, in response, calls to insulate resource management from populist impulses. We report on a randomized experiment testing methods to overcome this apparent tension between sound resource governance and democratic politics. Soon after Tanzania’s discovery of major natural gas reserves, we invited a nationally representative sample of voters to an intensive public deliberation of policy options featuring nationally recognized experts and small-group discussions. Democratic deliberation reinforced the public’s strong preference for rapid spending of gas revenues, but also increased support for various prudential and economically orthodox measures, including independent oversight of gas revenues, limits on government borrowing, and selling gas abroad rather than subsidizing fuel at home. These effects were driven by deliberation per se, rather than a pure information treatment, and show no evidence of contamination by facilitatoror peer-effects in group deliberations. www.cgdev.org Justin Sandefur, Nancy Birdsall, James Fishkin, and Mujobu Moyo