Deregulation and Privatisation: Evidence from the Telecommunications Industry in Europe and Implications for Switzerland

Abstract

Private ownership and competition are considered powerful instruments to achieve efficiency in individual firms and whole economies. Based on this conviction, many governments have pursued privatisation and deregulation programs in recent years. In this context, privatisation means that state-owned firms are sold completely or partially to private investors, turning over control from politicians to private managers and shareholders. Deregulation is defined as a reduction of government interference with market processes, allowing more competition. In the telecommunications industry it typically implies that private firms get access to markets that were previously characterised by a government monopoly.