Guasch, Jose Luis

Person:
Guasch, Jose Luis

University of California, San Diego

Author Name Variants

Guasch, J. Luis, Guasch, José Luis, Guasch, Jose-Luis

Fields of Specialization

Competitiveness; Industrial Organization; Innovation; Infrastructure and PPP

Departments

University of California, San Diego

Last updated:February 1, 2023

Biography

Mr. Guasch holds a Ph.D. in Economics from Stanford University, California, USA and Industrial Engineering Degree from the Polytechnic University of Barcelona, Spain. He is the Former Senior Regional Advisor in the Latin America and Caribbean (LAC) Region in The World Bank in Washington, DC, responsible for regulation, competitiveness, infrastructure/PPP , innovation and technology issues and investment climate for the LAC Region and was the Head of the World Bank Global Expert Team on PPP. He is also a Professor of Economics at the University of California, San Diego, since 1980. Over 30 years of experience advising Governments on multiple aspects i) on improving Competitiveness, and Innovation and Mainstreaming SMEs into the value chain; and ii) on Infrastructure and PPPs and Regulation (legal, institutional, processes, contract design, contract oversight, instruments and capacity building, financial issues, pricing etc). He has assisted and adviced Governments in more than 50 countries on a variety of isssues among them on competitiveness, and infrastructure and PPPs. He has written extensively in leading economic and finance journals, and has written several books. His most recent books are: (i) Managing the Regulatory Process: Design, Concepts, Issues and the Latin America and Caribbean Story; (ii) The Challenge of Designing and Implementing Effective Regulation: A Normative Approach and an Empirical Evaluation; (iii) Labor Markets: The Unfinished Reform in Latin America and Caribbean; (iv) Closing the Gap in Education and Technology in Latin America ; (v) Granting and Renegotiating Concessions: Doing it Right; vi) The Impact of Private Participation in Infrastructure; and vii) Does the Investment Climate Matter?

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Uncovering the Drivers of Utility Performance : Lessons from Latin America and the Caribbean on the Role of the Private Sector, Regulation, and Governance in the Power, Water, and Telecommunication Sectors
(Washington, DC: World Bank, 2013-06-07) Schwartz, Jordan; Andrés, Luis A.; Guasch, J. Luis
This book conducts a micro-level analysis of various determinants of infrastructure sector performance that affect development. This book focuses on the distribution segment of three basic infrastructure services: electricity, water and sanitation, and fixed telecommunications. This books aims to answer four main sets of questions: what are the main performance trends in the region, and how heterogeneous are they?; how does the performance of state-owned and private utilities differ?; how does the institutional design of regulatory agencies affect sector performance?; and what management mechanisms create incentives for improved performance?. This book begins by describing the main elements that characterize sector performance, defined as the delivery of reliable, affordable service that complies with certain quality standards. It focuses on the relationship between sector performance and the following determinants: private sector participation, regulatory agencies, and corporate governance. It also examines related aspects, such as contract design, market structure, and, for telecommunications, market competition. This book first explains the dynamics of utility performance and the interactions between key internal variables and utility performance in each sector. The book is organized as follows: chapter one is introduction. Chapter two outlines changes in the electricity distribution, water and sanitation, and fixed telecommunications sectors in the Latin America and the Caribbean (LAC) region over the past 15 years. This chapter tells multiple stories of the substantial improvement in these sectors and fills in knowledge gaps by benchmarking utility performance at the regional, country, and utility levels. Chapter three synthesizes the impact private sector participation has had on electricity distribution, water and sewerage, and fixed-line telecommunications. This chapter also identifies whether private sector participation characteristics such as the sale method; investor nationality; and award criterion affect performance. Chapter four explores the institutional design of regulatory agencies and the link between regulatory governance and sector performance. Chapter five assesses the governance of state-owned enterprises (SOEs) in infrastructure, based on survey results from 45 SOEs in the water and electricity distribution sector of LAC. Chapters six examines other potential determinants for sector performance, including corruption, cost recovery, contract arrangements, and competition. Chapter seven summarizes the book s main results and describes the array of possibilities for moving forward.
Innovative and Absorptive Capacity of International Knowledge : An Empirical Analysis of Productivity Sources in Latin American Countries
(2012-01-01) Castillo, Leopoldo Laborda; Salem, Daniel Sotelsek; Guasch, Jose Luis
This paper examines two sources of global knowledge spillovers: foreign direct investments and trade. Empirical evidence demonstrates that foreign direct investment and trade can contribute to overall domestic productivity growth only when the technology gap between domestic and foreign firms is not too large and when a sufficient absorptive capacity is available in domestic firms. The paper proposes the terms research and development and labor quality to capture the innovative and absorptive capacity of the country. The spillover effects in productivity are analyzed using a stochastic frontier approach. This productivity (in terms of total factor productivity) is decomposed using a generalized Malmquist output oriented index, in order to evaluate the specific effect in technical change, technical efficiency change, and scale efficiency change. Using country-level data for 16 Latin American countries for 1996-2006, the empirical analysis shows positive productivity spillovers from foreign direct investment and trade only when the country has absorptive capacity in terms of research and development. Foreign direct investment and trade spillovers are found to be positive and significant for scale efficiency change and total productivity factor change.
Public Private Partnerships in the Caribbean : Bridging the Financing Gap
(World Bank, Washington, DC, 2013-06) Guasch, Jose Luis
Caribbean countries are committed to achieving significant economic and social development to raise the living standards and welfare of citizens. To achieve rapid development, to support most needed sustainable high growth rates and poverty reduction, it is necessary to make substantial and immediate investments in economic and social infrastructure. Efficient, cost competitive facilities and services in transport and communications, energy, water, sanitation, health and education are essential to drive and support this development effort and to reduce poverty. Yet, fiscal space, the resources available to the public sector for needed infrastructure investments are very limited. Many Caribbean countries have high levels of public debt as a percentage of gross domestic product (GDP) and high fiscal deficits. Under traditional public procurement, government obtains a public infrastructure service such as electricity, water supply, schools and hospitals, by engaging a contractor to construct a facility which the Government then owns, manages and operates. This form of public procurement will continue, but as a result of the limited fiscal space, public infrastructure services development will also be sought through public private partnership (PPP) arrangements which will mean a broader role for the private sector in providing infrastructure facilities and services. The Governments of most Caribbean countries appear fully committed to promoting economic activities and enhancing the well-being of its citizens through more active participation of the private sector in improving the infrastructure of the nation. Those Governments believe that improving infrastructure through PPP arrangements will harness the development of the private sector to contribute to the growth of GDP and poverty reduction over the life of their respective strategic development plan and current administrations.
Governance in State-Owned Enterprises Revisited : The Cases of Water and Electricity in Latin America and the Caribbean
(2011-08-01) López Azumendi, Sebastián; Andrés, Luis Alberto; Guasch, José Luis
This paper studies the governance structure of state-owned enterprises in the water and electricity sectors of Latin America and the Caribbean. Through a unique dataset, the paper compares 44 leading state companies of the region based on an aggregate measure of corporate governance and six salient aspects of their design: board, chief executive officer, performance orientation, management, legal framework, and transparency/disclosure. The results indicate the need for improvement in areas such as the selection and appointment of directors to the board and the performance-orientation of the enterprises. The paper also highlights the importance of discussing the management of state-owned enterprises in the wider context of public sector governance, with particular focus on accountability. Moreover, it recognizes the role of accountability as central in the management of state-owned enterprises, recommending a better understanding of regulation and performance management. The paper finds a positive correlation between corporate governance and the utilities' performance. Among the different aspects of corporate governance, performance orientation and professional management seem to be the highest contributors to well-performing state-owned enterprises. State-owned enterprises in the electricity sector show higher governance levels than those in the water sector.
The Impact of Private Sector Participation in Infrastructure : Lights, Shadows, and the Road Ahead
(Washington, DC : World Bank, 2008) Haven, Thomas; Andrés, Luis A.; Guasch, J. Luis; Foster, Vivien
As numerous countries in Latin America and the Caribbean and elsewhere are moving toward a second phase of private participation in infrastructure programs mostly through public-private partnership schemes and other countries are just beginning the process, several concerns remain from the outcomes of the first phase. These concerns are making governments cautious in moving forward. The Impact of private sector participation in infrastructure addresses these concerns and brings clarity to the debate on the impact of private participation in infrastructure. The assessment of this impact may be one of the most emotional policy issues in economics, as it is clouded in a mist of myths, perceptions, and reality. This book analyzes the impact and sorts out the truth from the myths. The authors take a systematic and hard look at the facts (i.e., data) in Latin America, where starting in the late 1980s, many governments brought private sector participation into the delivery of essential utilities services. Although there are many assessments of this experience, none was able to rely on systemic, cross-country, and time-series data, and practically all of them did not save rare exceptions account for what would have happened in the absence of interventions (the counterfactual). This book does just that. It brings together an all encompassing database from the 1980s to the first decade of this century and develops an effective and robust methodology, accounting for the counterfactual, which tests and estimates the impact of reform on an exceptionally wide set of outcome indicators. As a result, this book presents the most in-depth study to date of the private sector participation experience in Latin America, and it substantially advances the existing literature by offering robust econometric analysis.
Overdraft Facility Policy and Firm Performance : An Empirical Analysis in Eastern European Union Industrial Firms
(World Bank, Washington, DC, 2012-06) Castillo, Leopoldo Laborda; Guasch, Jose Luis
This article evaluates the effect of the overdraft facility (or line of credit) policy by comparing a large sample of overdraft facilitated firms and matched non-overdraft facilitated firms from Eastern Europe at the sector level. The sample firms are compared with respect to rates of different performance indicators including: technical efficiency (a Data Envelopment Analysis approach is applied to estimate the technical efficiency level for individual sectors), production workers trained, expenditures on research and development, and export activity. In order to avoid the selectivity problem, propensity score matching methodologies are adopted. The results suggest that a certain level of overdraft facility provided to firms would be needed to stimulate investment in research and development, which will eventually result in increased growth in productivity.
Entrepreneurship Capital and Technical Efficiency : The Role of New Business/Firms as a Conduit of Knowledge Spillovers
(2011-07-01) Laborda, Leopoldo; Guasch, Jose Luis; Sotelsek, Daniel
Increasingly, entrepreneurship is being discussed and considered as a source of high economic growth and competitiveness. A conceptual process of creative construction that characterizes the dynamics between entrants and incumbents can prove quite useful to analyze the impact of countries' entrepreneurship capital on economic performance and can be a guide for economic policy. This paper applies a Stochastic Frontier Analysis approach to test the hypothesis that entrepreneurship capital promotes economic performance by serving as a conduit of knowledge spillovers. In addition, kernel density functions are employed to analyze convergence (or divergence) in the efficiency estimated for individual countries. The empirical evidence and results here tend to support the hypothesis. Specifically, the empirical analysis shows that the rate of expenditure on research and development in relation to new businesses registered has a positive and significant effect in increasing technical efficiency. These factors facilitate the dissemination of existing knowledge, develop entrepreneurship capital, and thus provide the missing link to economic performance -- entrepreneurship capital. The authors also show the trends and dynamics of changes in countries technical efficiency.
Granting and Renegotiating Infrastructure Concessions : Doing it Right
(Washington, DC: World Bank, 2004-01) Guasch, J. Luis
In most developing and industrial countries, infrastructure services have traditionally been provided by government enterprises, but in developing countries at least, these enterprises have often proven to be inefficient, unable to provide much-needed investments, and manipulated to achieve political objectives. By contrast, many studies have shown that over the past 30 years, private (or privatized) enterprises in developing countries have, on average, delivered superior performance and needed investments. Explanations differ on why this discrepancy exists. Private enterprises are driven by a desire for profits and may have more professional know-how in management, operating procedures, and use of appropriate technology. But perhaps the most important reason for their stronger performance is that privatization makes intervening in enterprise operations difficult for governments and politicians, so government manipulation is less likely. However, the issue, in general, has been how to ensure that the improved performance and efficiency gains are passed through to the users through lower tariffs and increased coverage, while allowing firms to earn a fair rate of return on their investments.
Innovative and Absorptive Capacity of International Knowledge : An Empirical Analysis of Productivity Sources in Latin American Countries
(Taylor and Francis, 2011-12-08) Laborda Castillo, Leopoldo; Sotelsek Salem, Daniel; Guasch, Jose Luis
This article examines two sources of global knowledge spillovers: foreign direct investments (FDI) and trade. Empirical evidence demonstrates that FDI and trade can contribute to overall domestic productivity growth only when the technology gap between domestic and foreign firms is not too large and when a sufficient absorptive capacity is available in domestic firms. In this article we propose the terms R&D and Labor quality to capture the innovative and absorptive capacity of the country. The spillovers effects in productivity are analyzed using a stochastic frontier (SFA) approach. This productivity (in terms of total factor productivity) is decomposed using a generalized Malmquist output-oriented index in order to evaluate the specific effect in technical change (TC), technical efficiency change (TEC), and scale efficiency change (SEC). Using country-level data for 16 Latin American countries for the period 1996–2006, the empirical analysis shows positive productivity spillovers from FDI and trade only when the country has absorptive capacity in terms of R&D. FDI and trade spillovers are found to be positive and significant for scale efficiency change and total productivity factor change.
Assessing the Impact of Infrastructure Quality on Firm Productivity in Africa : Cross-Country Comparisons Based on Investment Climate Surveys from 1999 to 2005
(World Bank, Washington, DC, 2010-01) Escribano, Alvaro; Guasch, J. Luis; Pena, Jorge
This paper provides a systematic, empirical assessment of the impact of infrastructure quality on the total factor productivity (TFP) of African manufacturing firms. This measure is understood to include quality in the provision of customs clearance, energy, water, sanitation, transportation, telecommunications, and information and communications technology (ICT). Microeconometric techniques to investment climate surveys (ICSs) of 26 African countries are carried out in different years during the period 2002 6, making country-specific evaluations of the impact of investment climate (IC) quality on aggregate TFP, average TFP, and allocative efficiency. For each country the impact is evaluated based on 10 different productivity measures. Results are robust once controlled for observable fixed effects (red tape, corruption and crime, finance, innovation and labor skills, etc.) obtained from the ICSs. African countries are ranked according to several indices: per capita income, ease of doing business, firm perceptions of growth bottlenecks, and the concept of demeaned productivity (Olley and Pakes 1996). The countries are divided into two blocks: high-income-growth and low-income-growth. Infrastructure quality has a low impact on TFP in countries of the first block and a high (negative) impact in countries of the second. There is significant heterogeneity in the individual infrastructure elements affecting countries from both blocks. Poor-quality electricity provision affects mainly poor countries, whereas problems dealing with customs while importing or exporting affects mainly faster-growing countries. Losses from transport interruptions affect mainly slower-growing countries. Water outages affect mainly slower-growing countries. There is also some heterogeneity among countries in the infrastructure determinants of the allocative efficiency of African firms.